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Late-Life Divorce: What Factors Do I Need to Consider?

On Behalf of | Feb 19, 2021 | Divorce

Decades ago, divorce was frowned upon at any age. But older divorce was especially rare. Most people figured that if a couple remained married until they were 50 or 60 years old, there was not much point in a divorce. But a new trend is emerging as baby boomers age. While the divorce rate for younger adults is declining, divorce rates for people over 50 are climbing. In fact, a Pew Research Center study from 2017 reports that the divorce rate in America for people over 50 has almost doubled since 1990. The reasons for this trend are unclear. Some hypothesize that society’s acceptance of divorce and lack of social stigma contributes to this trend. Others suggest that longer life expectancy may play a role. If people expect to live to the ripe old age of 85 or 95, they may not be so inclined to spend the next 40 years married to someone they no longer feel a connection to.

Regardless of the reason, late-life divorce is becoming more common than it has ever been before. And no matter what age you are, when divorce enters your life, there are serious issues to ponder. Older couples have a host of issues to deal with that would not be as important to people in their 20s or 30s. And the biggest issues are financial. It is harder to get a job that supports you in your later years, so ensuring that you are financially solvent is paramount.

Division of Assets

Dividing assets during a divorce is somewhat different later in life. This is a direct result of changing priorities and concerns as a couple enters their golden years. Divorce can catastrophically impact your retirement plan if you are not very careful about how you divide relevant assets. This is especially true if one spouse gave up a career to raise the kids. In traditional divorces, there is a growing trend that limits long-term alimony or spousal support. But if you initiate a late-life divorce, these issues become important. Whereas 35-year-olds can go out and build a career after divorce—even a new career if they choose—it is far more difficult to pull that off if you are in your 50s, 60s, and beyond. So let’s look at special issues that arise when dividing the following assets in a late-life divorce.

The House

Obviously, your home is one of your most significant investments. But the expense of living separately after divorce can impact your ability to keep and maintain the home after a divorce. Two people can live far more cheaply together than apart, so accept the fact that your expenses are about to increase. Before you demand the house, think about whether you can manage the mortgage independently. Also, consider if you can afford the upkeep. If not, it may be more of a burden than it is worth. However, there are some powerful benefits to keeping the house:

  • The government allows you to get a reverse mortgage after the age of 62, and that is a possible income stream in your later years;
  • Age triggers real estate tax exemptions, waivers, and benefits;
  • You can always sell the house, downsize, and bank the profits; or
  • You can keep the house and use it as a rental property, again giving yourself a viable income stream.

Each case is unique. So be sure to consult an experienced Tennessee divorce lawyer to go over your options and develop a plan that is best for you.

Retirement Accounts

Gray divorce can have a big impact on retirement plans and accounts. Retirement funds that would have easily supported a two-person household into your golden years must now support two single households. Because supporting two single households is significantly more expensive, the divorcing couple may find themselves in a financial quandary. How do you split up your financial retirement plan so that neither spouse is left high and dry?

The spouse who holds the majority of the couple’s retirement resources must consider various options. They may decide to forfeit a portion of their retirement account to avoid paying spousal support or vice versa. You will likely need a separate court order, called a qualified domestic relations order (QDRO), to divide retirement benefits. Lawyers should help you decide on provisions to include in a QDRO so you can:

  • Avoid unnecessary tax penalties;
  • Ensure that any monies previously withdrawn from the account are accounted for and repaid prior to division;
  • Ensure that you receive survivor benefits if your ex-spouse dies;
  • Know if hardship withdrawals are available in an emergency; and
  • Address survivor benefits for the civilian spouse of a military retiree.

As you can see, this can get complicated. Having a lawyer in your corner can protect your rights and interests during this process.

Health Insurance and Long-Term Care

Health insurance is a complex issue even under the best of circumstances. Many factors enter into healthcare decisions, especially for an older divorcing couple. Seasoned lawyers know what to look for. They consider whether your work history was more sporadic than your spouse’s. And if your spouse is still working, you need to know if that healthcare plan continues to cover you into the future. If you are both retired, will your ex-spouse’s retirement health benefits continue to extend to you? And if so, to what degree? Will benefits be cut or remain in full force? There are a multitude of questions to address so you don’t get left in the cold after divorce.

Late-Life Divorce Help

The family law attorneys at Batson Nolan PLC can guide you through your late-life divorce. We know your concerns for the future, and we can help. We start by attempting to work through issues with your spouse informally, or through mediation. We want to protect your legal rights going into the future. So call us today, or contact us online to set up a free consultation in our Clarksville or Springfield office.