Divorce over 50: Protect your finances
During the past few decades, while the divorce rate has fallen for most age groups, people over 50 have actually seen a significant increase in the divorce rate. As attitudes about divorce have changed and life expectancies have increased, more adults have chosen to end their marriages later in life. In addition, people point to the increasing financial independence of women as a reason for this trend.
According to a study conducted by the National Center for Family and Marriage located at Bowling Green State University, one in four people who get divorced today are over 50 years of age. In comparison, in 1990, only one out of every 10 people who got a divorce was 50 or older.
As this trend continues, it is important for those over 50 who are considering divorce to be aware of the unique concerns of their demographic. While younger couples will generally focus on issues such as child custody during a divorce, older couples should pay particular attention to financial concerns, as they will have fewer years to recoup any losses they suffer during the divorce.
Financial concerns when divorcing over 50
According to an ING study of Americans, those who are divorced tend to feel as if they are not as prepared financially to retire as individuals who are married. The study found that the average divorced person has $11,000 less in savings for retirement than a married person.
One of the most important factors for those divorcing over age 50 to consider is the tax implications of the financial decisions they make during the split. For instance, if the couple has a number of retirement accounts, it is critical to determine the actual value of the funds after taxes. In some cases, the money will be taxed when withdrawn from the fund. Taxes are not taken out of other types of retirement funds, however, such as Roth IRAs.
In addition, it is important for each spouse to consider the financial implications of keeping the house. Often, one spouse or the other will give up other assets in order to stay in the family home. In such cases, the spouse wishing to stay in the home should consider the ongoing costs associated with the home, including those needed for upkeep.
If you are over 50 years of age and considering a divorce, it is wise to obtain the assistance of a knowledgeable family law attorney. Consulting with an attorney will ensure your rights are protected.