Divorce among couples aged 50 and over is becoming increasingly popular. According to the Pew Research Center, the divorce rate for these couples has increased 109 percent in the last 25 years. The reasons for these “gray divorces” are varied. For one thing, people are simply living longer. When empty nesters are confronted with the possibility of living another 30 to 40 more years with a spouse they no longer have much in common with, divorce may seem like a better option. Furthermore, there’s no longer the same negative connotation assigned to divorce that there once was.
Some couples who divorce later in life have often both been working for decades. However, there are still many issues to think about during the divorce process to protect your financial goals. When thinking about post-divorce financial stability, there are myriad things to consider including how to plan for a healthy financial future, which include:
- Make sure your attorney goes through the discovery process; this will help uncover assets your spouse may have forgotten or be trying to hide from you.
- Prepare a detailed budget for yourself that takes all your post-divorce income, assets and liabilities into consideration. Seek professional advice if you need to; your future depends on making sure you live within a budget, save enough money for retirement and avoid mistakes that could be financially devastating.
- Consider how your income and living expenses will change. You might think you want to keep the big house where you raised your children. But will you be able to afford it on your own? If you and your spouse had been splitting expenses, consider that utilities, home maintenance, taxes, association dues and/or other related expenses will likely be your full responsibility after the divorce.
- You may have to forfeit pension or retirement funds that you would have been sharing with your spouse had you stayed married. This means you might have to change your lifestyle. Create a budget early on and stick to it.
- Ask questions. Talk to your attorney, tax advisor, accountant, financial planner and banker. The more information you have, the better you can plan your future and keep your finances on track.
Gray divorce doesn’t have to mean a lower standard of living. But chances are you will have a different standard of living. The good news is that you will be in control of the pocketbook — and all the decisions. By using your post-divorce autonomy to your advantage and putting yourself on the right financial track from the start, you can create the style of life that’s right for you.