Much has been said about the greater numbers of baby boomers who now divorce compared to decades past. Some may attribute it to changing American norms of economic independence. Regardless of the reason, graying divorcees may face some challenging financial circumstances after a divorce.
Part of this dilemma is due to the shrinking pool of assets that divorcees planned to use to fund their retirement. With a divorce, the marital assets are split, which means that retirement accounts, pension plans and real estate must be divided amongst the parties. With the marital estate divided, many people realize that they don’t have nearly as much to use for retirement as they initially believed. As such, they may be forced to delay retirement or decide to abandon such a plan altogether.
Also, retiring as a single person (as opposed to a married couple) could cost more. Essentially, divorced retirees may end up paying for mortgages (or rents) on their own instead of sharing expenses, they may have to take separate trips to see grandchildren instead of travelling with a spouse. Also, medical expenses may be higher as well.
Suffice it to say, older divorcees must take more time to plan for life after divorce, as they do not have the luxury of time to “figure things out” as younger people do. Also, with many more assets to divide, the split is just as much a business dissolution as it is an emotional one. As such, it would be prudent to consult an experienced financial advisor to work with a family law attorney in order to understand the financial implications of one’s legal decisions.