In The Black During Grey Divorce

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Senior divorce can be particularly difficult for property division.
Grey divorce can be particularly difficult for seniors seeking an equitable division of assets.

All over the United States, the divorce rate among seniors has been skyrocketing over the past 20 years. This phenomenon, colloquially known as grey divorce, presents a set of unique challenges. This is because older couples often amass a significant amount of assets during their marriages. Dividing property during a grey divorce can be especially challenging. 

A Bowling Green State University study found that older couples who divorced often see their household wealth decrease by half. Older women who get divorced experience a financial decline that is nine times greater than married women. 

Since people who divorce at age 50 or older are near retirement age, they do not have as much time to save for their twilight years. The retirement and 401(k) accounts that they have built during the marriage may be subject to division in their divorces as community property. The spouse who loses half of his or her retirement account balance might not have enough time to rebuild any savings.

Older adults who are thinking about getting divorced might want to talk to financial advisors and family law attorneys before they file their petitions. A family law attorney can work with the financial advisor in an effort to help the client to minimize the negative financial consequences of the separation. Furthermore, legal counsel might negotiate with the client’s estranged spouse to try to secure a property division agreement that protects the client’s financial interests and the ability to retire.

What Causes Gray Divorce Later In Life?

The term was first coined in 2004 by AARP. Some researchers believe the cultural values held by baby boomers, longer life expectancies, and the increasing financial independence of women are causes of the increasing trend in gray divorce. The social stigma of divorce has also decreased over the years. Here are some reasons unique to a gray divorce.

Financial Reasons

Some married couples might hold off on getting a divorce until they become more financially independent later in life, even if one spouse or both people were already unhappy in the marriage. In the past, women might not have been able to afford a divorce and support the children. Many women now are increasingly independent especially later in life.

There could be a partner who regularly overspends or mismanages the funds. Sometimes a partner who is the breadwinner makes all the financial decisions without considering the opinions of their partner.

Remarriage

Gray divorce is more common in remarried couples even though the divorce rate for marriages that have lasted at least 40 years is the lowest. The divorce rate of people over 50 who were remarried is 2.5 times more than those on their first marriage.

Empty Nest Syndrome

After their adult children have left the home, many couples feel that there is no further reason to stay together. Many people have lost the spark they felt where they were first married.

Improved Life Expectancy

One reason for the increasing divorce rates is that many older people may believe they have plenty of time to discover happiness on their own. Some also believe they will find someone else even if they get divorced after the age of 50. People expect to live longer, so they might want to have a new life after their marriage ends and change the way they live. Previously, many older couples might have thought there was little point in getting a divorce when they did not expect to live much longer.

Retirement

When both or one spouse retires, there can be a significant lifestyle change. The couple spends more time together which can cause friction in some cases. Many long term marriages fall apart because couples find that they don’t enjoy spending time together. Their interests or the way they spend their free time might not be compatible.

What Are The Main Issues In Gray Divorce After A Long Term Marriage?

Given that gray divorce can take place after couples have been married for many years, the usual issues of property division can have different implications. Here are some of the complex issues that come with a divorce after a long-term marriage.

Property Division

If you have been married for a long time, you or your ex might have accumulated a substantial amount of assets like bank accounts, property, or retirement savings that now has to be split between both of you. The majority of your assets may be community property. One of the most important assets in property division is retirement accounts. It can be difficult for you to recover financially due to your age and your retirement lifestyle may be affected.

Texas is one of the nine states that follow the “community property” principle in property division. However, the judge has the right to make changes to the 50/50 division of property depending on what he or she feels is just and equitable. For example, a spouse who has significant health issues or very low employment prospects after the end of the marriage can often be awarded more property in a 60/40 or even a 70/30 split. If both of you are already retired and living off fixed benefits, it’s highly likely that there will be a 50/50 split.

A couple will need to divide the family home as well even though they may have an emotional attachment to it. Some couples opt to sell the house and split the money. Others may agree to have one spouse keep the house. In exchange, the other spouse may receive other assets. However, you will need to consider the cost of maintaining the house. If it is too expensive, you could end up using retirement savings to maintain the house.

Alimony

There is a high chance that alimony will be awarded for the rest of your life after a long-term marriage has ended. It is unlikely that the financially dependent spouse could start a new career and work up to the lifestyle they enjoyed before the divorce later in life. If you were the one supporting the family, you may worry about continuing alimony payments after you retire.

Factors that determine alimony include the income that each person makes, health, earning potential, and education.

The calculation of compensation can also become complicated for an older person. They might receive bonuses and stock options along with base compensation. The court will need to consider these to decide the amount of alimony to award after a grey divorce.

Social Security

The financially dependent spouse may be able to claim Social Security benefits based on the employment record of the other spouse. You must be at least 62 years old and not be married after your divorce. Your marriage must have lasted more than 10 years. You must also be entitled to less Social Security benefits than your spouse is. You may receive survivor benefits if your ex-spouse passes and you were married for at least 10 years.

If your marriage ended at least two years ago, you do not have to wait for your ex to claim benefits.

Insurance

If you were on your ex’s health insurance, you may need to start paying for your own health insurance coverage after a divorce. This can cost a substantial amount of money at your age. If you are at least 65 years old, you may qualify for Medicare if you can claim Social Security benefits based on your ex’s employment record.

In Texas, you will not receive your ex’s life insurance payout after divorce, including after a grey divorce. This applies even if you are still the designated beneficiary on the insurance plan. Exceptions apply if your ex designated you as a beneficiary after the divorce.

Long Term Care

You may now need to plan how to manage the costs of long term care as you get older. This is important if you were financially dependent on your ex. In some cases, you might have lost a substantial amount of your assets during the divorce. This can include the costs of staying in a nursing home or assisted living facility.

Financial Support For Children

Both of you might have agreed to provide financial support to your adult children for things like their education. You may need to ensure that you can continue to meet your obligations after a divorce. In many gray divorces, former couples also want to make sure that the children will inherit their estate after death.

Estate Planning

You may need to make sure that your children will inherit your estate if you pass away at any time during or after the divorce. If you pass away during the divorce, your spouse may inherit everything you have.

You might also want to change who has the power of attorney. This can determine who can make decisions for you during incapacitation. If you get married again, you will also have to consider how to manage the property of the new relationship. You need to determine how to protect property from your first marriage for your children to inherit.

The issues that come with gray divorces later in life are complex. It’s important to consult an experienced attorney to protect your interests. Being well-prepared can significantly improve the quality of your life after grey divorce. Consult the award-winning experts at Sean Lynch who have decades of experience in family law.

Contact us today for a no-cost case review.


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