You may have heard the statistic that 50 percent of marriages end in divorce. This statistic is true, and remains stable, but here’s an additional statistic that the base numbers don’t show: divorce among those over the age of 50 has doubled over the 20-year period between 1990 and 2010. 600,000 people over the age of 50 got divorced in 2009 alone.
Unfortunately, when people take this drastic step, they often find that they’re not leaving themselves with enough money on which to live after retirement. Learn about asset protection and divorcing after retirement, and how to make sure your estate planning remains in place and secure into your golden years.
Baby Boomers and Divorce
The Baby Boomer generation has a different outlook on divorce than past generations did, which has led to this increase in statistics. Alternatively called the “can do” generation and the “me” generation, these people often experience two or three marriages, and as they hit retirement age, they want to live life to the fullest.
One interesting statistic: 66 percent of post-retirement divorces reported are initiated by wives rather than husbands, according to the AARP.
The High Cost of Divorce after Retirement
The biggest problem with divorce after retirement is that during their working years, couples save enough to retire on together. It costs a lot more for two people to live separately than it does for them to live forever, and when these funds are halved in the divorce settlement, there’s often not enough left on which to live. Social Security or pension plans just aren’t going to make up the extra costs.
Some couples think they can sell their home and use the proceeds to live, but as we get closer to our elderly years, many find that the home is in disrepair, has lost value, or simply can’t be sold for some reason.
When it comes to post-retirement divorce, it’s vital to protect your assets. Many estate planning experts recommend that those who are marrying near retirement age use a pre-nuptial agreement to defend their assets. Even for those who are already married, a post-nuptial can be signed to keep inheritances and assets in the name and control of one party in the marriage.
Some couples use a separation agreement rather than divorce, which allows them to live separately but keep their finances intertwined, which can save money, protect assets and allow both to live closer to the means to which they’re accustomed. Others choose to wait a few years after retirement, when earnings are demonstrably less.
Talk about Estate Planning
What happens if one party has pension which may be awarded in the divorce, and then dies before the proceedings are finalized? That pension could vanish. It’s important for couples to talk about these things while the marriage is still strong, and ensure that when one half of a couple passes away, the other is taken care of.
If you’re looking to take care of estate planning issues to make sure your assets are protected and your family cared for, contact an asset protection lawyer like those at Tanko Law. Give us a call and take advantage of our knowledge and experience to help you today.