Divorce is never easy, but starting over after decades of marriage can be especially difficult. Unfortunately, the so-called “gray divorce” is on the rise. While divorce rates, in general, seem to be declining, the over-50 age group has seen divorce rates double since 1990, when roughly 5 out of every 1,000 couples divorced, as opposed to an estimated 10 for every 1,000 in 2015.
You might think divorcing at a younger age is more difficult because it is more likely to involve underage children in the household. However, older couples that divorce simply faces a different set of challenges. One problem for many divorcing couples over 50 is figuring out how to separate a complex web of financial entanglements and come out as two single people capable of supporting themselves and moving on with their lives.
What can you do to protect your financial interests during a late-life divorce? How can you make sure you have adequate resources to support yourself after retirement now that you’re going to be single and there’s no guarantee of the second income? Can you do it alone? If you’ve had to rethink your life plan due to a late-life divorce, here are a few ways to ensure financial stability and gain confidence in your ability to support yourself now and in the future.
Tally Up Assets
Leading up to your divorce, one difficult task you’ll have to face is totaling up your marital assets and debts so that they can be properly divided. Generally speaking, these will be divided in a fair and equitable (although not always perfectly equal) manner, especially after so many years of marriage. A prenup could interfere, but in some ways make the division easier if the details are already spelled out in legal form.
Regardless of whether you’re the person who manages finances in your relationship, or if you split duties, you really need to try to determine every asset, including real estate, bank accounts, investment accounts, retirement accounts, and joint property like automobiles, art, and so on. Your best bet is to hire professionals like attorneys and accountants to help you here so you make sure you get all you’re due.
Don’t Be Sentimental about Your Home
After many years of marriage, you may have a lot of equity in a home. Even for many older couples, this is the biggest asset on their books. If you have the resources on your own to comfortably pay the mortgage (if any remains) and pay out your partner for half the equity, then maybe you can enjoy the luxury of staying in your home.
However, with grown children out of the picture and years of accumulated memories in a home with your ex-spouse, do you really want to stay in the marital home anyway? Selling a house or taking a payout and leaving it to your ex can give you the cash to roll over into a smaller, more financially manageable property (reducing mortgage, insurance, property tax, and even utility costs). You might even be able to get a rental property like a duplex for an influx of passive income.
Planning for a Different Future
Things may seem pretty bleak in the wake of your divorce. You’re on your own after many years of marriage, entering a new era of online dating that probably didn’t exist before you coupled up. Your household income has been cut in half and you’re suddenly responsible for all of your living expenses and financial planning. You may be nearing the end of your career and preparing for retirement.
It’s understandable to be nervous about your financial situation. However, there are a few things to be grateful for. For example, you can make new plans and goals without having to compromise with another person. Your dream retirement trip abroad that your spouse was always grumbling about? Now you can plan it on your own or with friends instead and have a fantastic time!
You’ll just need to make sure you plan for financial success moving forward. For starters, you’ll need a new budget, and you’ll also want to take the lion’s share of the money you get out of your divorce and funnel it into targeted investment strategies that cater to your specific needs. You naturally don’t want to risk your retirement for the chance at a bigger payday, but with the help of a reliable firm specializing in investment management and retirement strategies, you have the opportunity to make your money work for you.
Finding yourself divorced and single over 50 is not what most of us plan, but it can end up being a revelatory and even rewarding experience in the long run. It can be an opportunity to rethink your future, pursue personal goals you may have forgotten during a marriage, and live the rest of your life to the fullest.
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