Divorcing at any age is not easy, even when the split is amicable. For people who are nearing or already in retirement, there are special considerations for “Gray Divorce”. Or, if you want a term with more bling try “Silver Splitters” or “Diamond Divorcees”.
But often bling or lack thereof is an issue for people who end marriages later in life. People who divorce later in life have fewer working years left to recover from the financial losses of divorce. These losses include the legal costs involved in getting the divorce and for many, the subsequent loss of income. Even those who had solid financial planning in place before a Gray Divorce will need to pivot and reevaluate.
TheStreet.com offers “Five Tips for Surviving Gray Divorce in Retirement.” Before you get to practical tips, however, the article reminds readers to consider how this life change can be “daunting and stressful and decisions tend to be made on emotions rather than facts.”
Getting help from an objective Fee-Only financial planner can keep you from making rash decisions. You will need someone who knows how to take a long-range view of the financial considerations you may not be ready to face.
“Perhaps one of the best ways to handle financial expectations and fears is to use a data-driven approach to the divorce settlement process. While developing your settlement it is important to understand the short and long term effects on cash flow, taxes, and your net worth five, ten, even 20+ years into the future. What may seem fair or equal on the surface is not equitable many times when looked at from a longer range view.”
A late in life divorce may mean delaying retirement, waiting longer to take Social Security, getting a reverse mortgage, or selling property. None of these things have to be devastating however, especially if you have a plan in place for financial security despite the divorce.