In our previous post, our blog discussed how more and more older Americans are now deciding to pursue divorce, a trend that many attribute to everything from greater financial autonomy to a seismic shift in social patterns.
Whatever the reason behind the increase in so-called "gray divorces," it's important for older people looking to exit a long-term marriage to keep certain financial considerations in mind when going through the divorce process.
In today's post, we'll take a brief look at some of these considerations.
Retirement accounts -- pensions and 401(k) plans
Many couples have been very diligent in planning for their retirement, devoting a percentage of each paycheck to their employer's retirement plans and taking advantage of matching programs. In light of this diligence, neither spouse wants to lose out when it comes to dividing up 401(k)s and other retirement assets, which can still see considerable growth post-divorce and be a very valuable asset moving forward.
As such, it's imperative for an older divorcing spouse to retain the services of a divorce attorney with extensive experienced handling complex property division matters, and to make sure they are aware of any and all such assets (retirement accounts, IRAs, pensions, etc.).
While the prospect of sitting down to create a budget after learning a decades-long marriage is coming to an end probably sounds unappealing, experts indicate that it is an absolutely vital step to take prior to the entering divorce negotiations.
That's because a post-divorce budget accounting for future living expenses can help clarify what assets they should attempt to negotiate for and what they can afford to part with in the next chapter of their lives.
We will continue to explore this subject in future posts. In the meantime, older spouses seeking answers about divorce should strongly consider speaking with an experienced legal professional.
Source: Vanguard, "How to deal with the financial challenges of late-life divorce," Accessed Oct. 27, 2014