While the divorce curve in most age groups is flattening, there is one segment of the population with an increasing trend. This group consists of couples in long term marriages, thus creating a phenomenon called “gray divorce.”
This type of divorce involves spouses over the age of 50, who are mostly Baby Boomers. Unfortunately, most of them aren’t prepared to handle the unique legal and practical issues existing for older people. Notably, the financial implications of such can be incredibly profound.
Why People Divorce Later in Life
When the kids finally reach adulthood and move out to pursue their dreams, many things could happen to a couple, thus pushing them towards divorce.
Some couples realize that they’ve merely been growing apart through the years. Perhaps one spouse might be preparing for retirement while the other is thinking of starting a new career, or discovering they have different interests.
Second, third and fourth marriages seem to have a lower success rate. The divorce rate among people over the age of 50 who have been in more than one marriage is 2.5 times higher than those who’ve only married once.
When couples are still in their prime years, financial blunders are often overlooked. Since money is still coming in, it’s easy to allow an overspending spouse to get their way. But this cannot continue once this steady income stops and have to live on their savings.
On the other hand, some spouses will wait until they are financially stable so that they can initiate a divorce – and this will mostly happen when the couple is much older.
Issues That Impact a Divorce After 50
- Social security
- Division of assets
- Spousal support
Divorcing and Retirement
Before filing for divorce, remember that a gray divorce will impact a couple’s retirement plans. In many cases, a single retirement plan will now have to take care of two separate retirement lifestyles.
If both of you are planning to retire and file for divorce, you should think about the following:
- Working longer hours than expected to secure your future post-divorce
- Shunning from giving any money to your adult children
- Selling off the family home and instead, buy something smaller and cheaper
- Keep the divorce’s legal costs as low as possible
- Cut extra expenses such as buying luxury items, travel, etc
- Including the retirement plan in the divorce settlement
One thing divorcing couples can do to avoid retirement problems altogether is to schedule a consultation with a financial expert. This expert will help each spouse understand what their budget should be and what they can do to plan for their retirement once they are declared divorced. The planner will also model the impact the divorce will have presently and after retirement.
Besides, they should get a divorce lawyer who understands the impact of dividing retirement assets relative to your retirement target date.
Planning For Future Health Issues
As people age, medical conditions like diabetes, arthritis, clogged arteries, and mobility issues are likely to kick in and affect competency. One should realize that he or she will be facing these issues single-handedly if the divorce goes through. However, there are things you can do to prepare for this future.
If one spouse has spent a considerable amount of time taking care of the family, he or she may not have adequate resources. They can try to negotiate with the other spouse to get long term care insurance. You may qualify for Medicare under your ex-spouse’s work record, but this is only available if you are over 65 years. A spouse who will be a beneficiary can also request to be a holder of the policy to ensure they are kept in the policy.
Another item to consider is life insurance, which is generally associated with a spousal support award to ensure that spousal support will actually be paid.
Celebrity Gray Divorces
The spike in gray divorces hasn’t escaped the celebrity domain. Famous couples are divorcing each other after decades of marriage.
- Arnold Schwarzenegger and Maria Shriver (Married in 1986. First marriage for both, divorced in 2011)
- Morgan Freeman and Myrna Colley-Lee (Married in 1984. His second marriage, her first. They divorced in 2010)
The most critical issue of all gray divorce issues is choosing the right divorce professional. Whether it is a divorce lawyer, a divorce mediator, or a financial advisor, you need a professional who will preserve your money and time.