Divorce later in life requires careful planning for retirement

According to recent statistics, younger couples are less inclined to seek a divorce. However, for those aged 50 and older, the divorce rate has increased more than 100 percent. Colorado residents who are seeking a “gray” divorce may have to revise retirement plans.

In the past, women often relied on their husbands for health insurance and their standard of living. Now, more women have achieved financial independence and are able to meet their own financial needs, including planning for retirement. This may be one of the reasons that more couples are willing to seek a divorce after years of marriage. However, this makes the need for careful planning even more essential during the division of marital assets.

In spite of the financial freedom more women have obtained, it is still daunting to ensure that there will be enough assets for separate retirement plans and household expenses. Even though a retirement account may appear to have a healthy balance, if it is to be divided in a divorce, there will likely be early withdrawal taxes. This can quickly consume a large portion of the assets. Likewise, the cost of upkeep on a home may place an undue burden on a spouse who decides to retain it rather than sell and share the proceeds.

There are many other considerations for couples who are contemplating a divorce. Though older couples are less likely to have minor children, those who do may need to restructure their retirement dreams in order to compensate for child support payments. In addition, Social Security benefits could be reduced if a spouse chooses to remarry in the future. A gray divorce can take a toll on retirement dreams. Colorado residents who are planning to file for divorce may be best served by seeking the guidance of an experienced attorney in order to preserve their financial well-being now and in the future.