People who divorce after several decades of marriage or longer typically need to focus their attention on different matters than those who divorce in their 20s or 30s. Instead of dealing with child custody agreements and the mortgage on the family home, those going through what has rather unfortunately been named “gray divorce” likely have more pressing issues as they near – or maybe are already in – retirement.
Every couple is unique – and so are the matters they need to work out as they end their marriage. However, a couple of things are more likely to be worth giving some serious thought to.
Dividing retirement assets
This is a big part of most couples’ asset division. If you both have had long careers, however, a significant part of your assets are likely in individual retirement accounts (IRAs) that you’ve rolled your 401(k)s into as you’ve changed employers over the years.
Preserving your fair share for your own retirement is crucial. You’ll likely need a qualified domestic relation order (QDRO) to make the necessary transfers to each other without incurring penalties.
Seeking or paying alimony
Florida no longer offers permanent alimony as an option for divorcing couples. There is a new type of alimony – durational – that’s based in part on how long a couple has been married. There are other factors as well, like the age and health of the spouses, the marital standard of living and each one’s income and assets.
When one divorcing spouse outearns the other, it can be difficult to close that gap (especially for women) as people get older. Getting fair spousal support is crucial to financial well-being after divorce. The paying spouse also needs to make sure it’s fair – and that it can be modified if they retire.
There are plenty of other things to consider, like how much your Social Security retirement benefits will be and when it’s best to start collecting them, what financial obligations you may have to your adult children (like paying off student loans or making good on a promise to help pay for a wedding) and more.
Divorce at this stage of life can feel overwhelming. In addition to sound legal guidance, it can help to get your own financial, tax and real estate professionals to help you make the best possible decisions for your future.