Over the last 25 years or so, divorce rates have more than doubled for those aged 50 and over. Thought to be due, at least in part, to an increase in life expectancy, these later-life divorces have some unique considerations and risks. So, if you or someone you know is planning on filing for what the media is calling a “gray divorce,” it is important to know how to best protect oneself and financial future.
Understanding the Risks of Gray Divorce
While all divorces are considered financially, mentally, and emotionally complex, those that occur later in life carry some serious financial risks, namely a situation known as divorce-induced poverty. This is a risk of particular concern for those who have already retired or have been out of the workforce for a long period of time. In addition, women, who typically live longer than men, may experience long-lasting poverty if they do not take proper precautions during their divorce.
Preparing Your Finances
In Illinois, marital property goes into what is known as the marital estate. This includes assets like your home, bank accounts, retirement accounts, vacation homes, vehicles, and more. These items are then valued and distributed equitably among the divorcing parties. Of course, before this can happen, you will need to know what it is that you and your spouse own. For those kept in the dark about their finances, this can seem like an insurmountable task. Furthermore, there is always the risk of disappearing assets. Rest assured: your attorney can help with the process. For now, simply gather all of the financial information you can find.
Planning for the Future
Most couples who file for divorce consider issues like whether or not they are going to keep the house or other valuable assets. However, these couples have time to recover, should they fail to fully consider the tax implications of keeping certain assets. Further, those facing a gray divorce may not have the physical means to maintain the home they are currently in. For these reasons, gray divorcees should carefully examine their finances and assets and then determine whether or not they have the time, energy, and cash flow to maintain any assets they are thinking of keeping.
Also, be sure to keep a clear head during the process of divorce. While it can be easy to become emotional about the dissolution of your marriage, the loss of a home, or the worries of health or financial problems, this can cloud your judgement and make it more difficult for you to effectively plan for the future.
Skilled Legal Representation for Your Gray Divorce
At MKFM Law, we understand the unique complexities that you are facing in a gray divorce, and we are committed to helping you successfully transition to the next phase of your life. Dedicated to your best interests, and your financial future, we walk you through the entire process and serve as skilled, compassionate advocates, every step of the way. To discuss your case, schedule your initial consultation with our Wheaton, IL divorce attorneys today. Call 630-635-7300.
Source:
https://money.usnews.com/money/retirement/baby-boomers/articles/navigating-divorce-in-retirement
