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Divorcing later in life is becoming more commonplace among people 50 and over. Divorce among older couples has more than doubled since the 1990s. In 2015, 10 of 1,000 married people filed for divorce. Five of 1,000 married filed for divorce in 1990. The divorce rate for people 65 and older has tripled since 1990.[i]

For older couples thinking about “gray divorce,” ensuring your finances are in order may help ease the strain.

Here are some tips to help make it easier and less stressful:

Identify your individual incomes

Determine income levels of each spouse. Divorced spouses will no longer be able to rely on their partners’ incomes. In gray divorces, men typically experience income drops of 23%; women’s incomes drop by 41%.[ii]

The impact on older women may be especially difficult. Gray divorce forces many older women between the ages of 50-74 to continue full-time work, rather than retiring.[iii] Calculating future income and assets as a divorcee is important. Getting a divorce can devastate a couple’s finances.[iv]

Manage your retirement accounts

Divorcing couples will also have to manage how they’ll divide their 401(k) and IRA accounts. After years in the workplace, many retirement accounts have grown substantially in size.[v] Dividing those accounts while maintaining two households can get complicated and expensive. Most likely, workers listed their spouses as beneficiaries on retirement accounts and insurance policies.[vi]

Changes in Social Security

If your marriage lasted 10 years or longer, you may have the ability to receive part of your ex-spouse’s Social Security benefits, whether or not he or she is remarried. In order to do so, you must meet the following requirements:

  • You are age 62 or older
  • You are unmarried
  • Your ex-spouse is entitled to Social Security
  • The benefit you are entitled to receive based on your own work is less than the benefit you would receive based on your ex-spouse’s work.

Consider downsizing your home

The home is one of the largest assets of older couples. It also generates some of the biggest expenses, especially if retirees maintain mortgage debt. Many older couples are going into retirement with mortgage debt, which can drain cash reserves.[vii] A better option might be downsizing by moving into a smaller house or renting a place to offset the reduced household incomes.[viii]

Stay focused

Sometimes divorces, even later in life, can get messy. While financial and budget management is important, guarding your emotional condition and ensuring you maintain a strong support network are important in sustaining long-term security and comfort.[ix] Establishing a firm emotional support system helps newly single individuals move forward and adapt to lifestyle changes.

In more contentious divorces, long-time friendships can disintegrate and rifts can form in otherwise amicable families. Begin establishing relationships with your most trusted and loyal friends, which can help fortify your emotional stability and may help protect you against failing health from increased stress.

Overall, your individual needs and retirement goals will define the financial strategies you should address if divorcing later in life. If you have questions about the options available, or how a divorce could impact you financially, feel free to contact us.










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