Baby boomers are living longer, healthier lives and possibly also, as a result, more are divorcing later in life which is referred to as "gray divorce." The number of couples divorcing over the age of 50 continues to grow. One in four divorcing couples today are over the age of 50 which is also a time in their lives that many couples are considering retirement. One study revealed that, between 1990 and 2010, the divorce rate for couples over 50 doubled.
A number of couples divorcing over 50 no longer have children in the house or are divorcing from their second marriages which have a higher rate of divorce. Gray divorces can have a significant impact on retirement savings, as the retirement the couple may have been planning on can be cut in half to support two households following the divorce instead of one. Pensions and IRAs that were earned during a marriage are typically considered the property of both spouses and may be divided in half. Health insurance may also be a concern and well as the tax consequences of property division.
Gray divorces may result in a different lifestyle for the divorcing parties following the divorce and they need to be prepared for this. Couples may have significant finances to divide or not much to divide and one spouse is commonly more familiar with the finances than the other. Women may also have remained at home to raise children or worked part time and not have as much retirement savings.
There are a number of challenges gray divorces may present which is why it is helpful to be familiar with the divorce process and how it will impact concerns the divorcing couple may have. Divorce and property division can be challenging at any age which is why it is helpful to have proper guidance throughout the process.
Source: Colorado Springs Gazette, "Retirement: Gray divorce can drag both parties into the red," Rodney Brooks, April 12, 2016