Age does not matter in a divorce. Research shows that for those 50 years and older, the gray divorce rate has almost doubled since the 1990s. A long-term marriage means a combined pool of finances and properties accumulated through the years, making the process more stressful than it already is.
If you are contemplating a late-in-life divorce, you must prepare for the economic fallout ahead.
The financial blow
Whether you still have some years left to work or have already left the workforce for good, you must prepare for the following financial considerations:
- Retirement account: In Texas, an individual retirement account is a community property if acquired when you were married. You and your spouse have equal claim to it unless proven otherwise with an official settlement agreement. However, if it is a separate property you owned, inherited or received as a gift before your marriage, the court does not award anything to your spouse.
- Health insurance: If your spouse’s employer-sponsored plan covers you, then it is time to consider switching to a different health plan. Further, you are still not eligible for Medicare if you are under 65.
- Estate planning: You need to reevaluate your wills, trusts and powers of attorney. It is wise to designate different individuals as beneficiaries and executors.
- Tax implications: Division of assets and property and alimony or spousal support all come with tax considerations. Splitting retirement accounts also has tax obligations.
Money matters are just a portion of everything at stake in a gray divorce. Lifestyle changes, family circumstances, relationship adjustments and emotional fallout will all naturally be a part of a late-in-life divorce.
The silver lining
Divorce, regardless of age, generates a financial storm. The key is having a reliable legal resource to guide you in guarding your rights and finances.