Some couples in their 50s and 60s who have been married for many years are coming to the conclusion that now that the kids have left the nest, they have very little in common. These couples — some of whom hail from Texas — are making the decision to leave unsatisfying marriages and heading for what is known as gray divorce. Although it may be the best thing for each person emotionally, ending a long-term marriage can have a major impact on retirement savings, taxes and overall finances.
Getting a divorce past the age of 50
Gray divorce is on the rise, but there can be a downside to leaving a marriage moving into the Golden Years. Here are some of those:
- Standard of living may be affected. If a couple has amassed a nest egg for retirement, it will now need to be shared. Money won’t go as far as planned.
- Retiring at 60? Maybe not now. Retirement might have to be postponed if a person wants to continue living as he or she has been accustomed to living.
- Might need to pay taxes and penalties. When it comes to retirement plans, a professional will be needed to prepare a qualified domestic relations order (QDRO) which assigns a portion to each spouse and stipulates when the funds are doled out, when taxes are paid, etc.
- One spouse could be paying alimony. It’s more common in marriages that have been long-term for one spouse to be paying alimony to the other. This could drastically affect the financial picture.
- Then there is the matrimonial home. What to do with the family home could cause a lot of angst. Should it be sold? Should one spouse buy out the other? It’s a big decision.
Getting a divorce after the age of 50 can be very stressful, but there are ways to combat that stress. Getting independent legal advice from a lawyer in Texas who is experienced in gray divorce may be a good place to start. It is best to understand how divorce may impact various areas of life.