Divorce always presents financial issues, and that can be especially true for partners seeking divorce later in life. A 'gray' divorce refers to couples who get divorced usually after 40+ years of marriage, but can also be referred to as silver or diamond splitters. Gray divorcees have a unique set of financial circumstances to contend with.
The frequency of gray divorces in America is rising, having nearly doubled since the 90s, while divorce rates among other age groups have declined. Adults 65 and older have seen the divorce rate triple over the same time period, which means for Baby Boomers it is more important than ever to prepare yourself financially in the eventuality of a gray divorce.
Unsurprisingly, one of the primary motivations behind divorces are finances. Within a long-term marriage between two individuals with different outlooks on their lives, careers, and monetary goals, fights over finances are likely to occur.
The increased life expectancy in recent years is adding to the strain, with life expectancy quickly increasing by 5.5 years over the past 20 years. This increase could mean Baby boomers are more cognizant of outliving their assets in retirement and so may have decreased patience for a partner who is frivolous with money. Also, the knowledge that they will likely live longer can make them hesitant to remain in an unhappy partnership.
Among the considerations to keep in mind through a gray divorce is the home which would likely be sold and split between the parties. be sure to consider both the tax implications and long-term cost if you do wish to keep your family home as it can be more costly than you realize.
Retirements will take a big hit in the aftermath of a gray divorce. That's because the financial planning prior to the divorce was meant to cover the living expenses of a single household, while post-divorce it will have to cover two. Any retirement accounts such as 401(k)s, IRAs, HSAs, and similar will be divided.
The division of 401(k) assets are determined by laws within the state where the divorce is finalized, with some states following "community property" standards which usually results in a 50-50 split. Most states, however follow "equitable distribution" rules, which leave the division up to the court.
Alimony for younger marriages that end is usually short-term, alimony for a long-term marriage will likely be for the duration of the recipient's life.
If your marriage lasted at least 10 years, you can get Social Security benefits on your ex-spouse's record even if he or she remarried provided you are over 62, unmarried, your ex-spouse is entitled to Social Security retirement or disability benefits, and the benefit you're entitled to get based on your own work is less than what you would get based on your exes work.
Having an attorney with the resources and knowledge to give you the best representation is vital to your interest and the interest of your family. You also want to make sure they will exhaust all avenues and be willing to research, pursue and implement strategies to provide the best possible outcome.
The frequency of gray divorces in America is rising, having nearly doubled since the 90s, while divorce rates among other age groups have declined. Adults 65 and older have seen the divorce rate triple over the same time period, which means for Baby Boomers it is more important than ever to prepare yourself financially in the eventuality of a gray divorce.
The increased life expectancy in recent years is adding to the strain, with life expectancy quickly increasing by 5.5 years over the past 20 years. This increase could mean Baby boomers are more cognizant of outliving their assets in retirement and so may have decreased patience for a partner who is frivolous with money. Also, the knowledge that they will likely live longer can make them hesitant to remain in an unhappy partnership.
Among the considerations to keep in mind through a gray divorce is the home which would likely be sold and split between the parties. be sure to consider both the tax implications and long-term cost if you do wish to keep your family home as it can be more costly than you realize.
Retirements will take a big hit in the aftermath of a gray divorce. That's because the financial planning prior to the divorce was meant to cover the living expenses of a single household, while post-divorce it will have to cover two. Any retirement accounts such as 401(k)s, IRAs, HSAs, and similar will be divided.
The division of 401(k) assets are determined by laws within the state where the divorce is finalized, with some states following "community property" standards which usually results in a 50-50 split. Most states, however follow "equitable distribution" rules, which leave the division up to the court.
Alimony for younger marriages that end is usually short-term, alimony for a long-term marriage will likely be for the duration of the recipient's life.
If your marriage lasted at least 10 years, you can get Social Security benefits on your ex-spouse's record even if he or she remarried provided you are over 62, unmarried, your ex-spouse is entitled to Social Security retirement or disability benefits, and the benefit you're entitled to get based on your own work is less than what you would get based on your exes work.
Having an attorney with the resources and knowledge to give you the best representation is vital to your interest and the interest of your family. You also want to make sure they will exhaust all avenues and be willing to research, pursue and implement strategies to provide the best possible outcome.
Rob McAngus, Partner with Verner Brumley Parker, P.C., is Board Certified in family Law and his practice is devoted primarily to family law, including high conflict divorce, custody cases, and complex property issues. In addition to being selected on the Board of Directors for the Family Law Section of the Dallas Bar Association; he values your priorities as a parent and works with you to achieve the goals that will help transition your family to a new normal. As both an adopted child and a member of a blended family, Rob can provide a unique perspective in the practice of family law.
Rob has been recognized in Super Lawyers as a Rising Star in 2016 through 2019, and recently The National Advocates recognized Rob as one of the Top 40 Under 40. He can be reached by calling 214.526.5234 or email at rmcangus@vernerbrumley.com.
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