According to researchers, the divorce rate among younger adults has leveled off. However, the rate for those 50 and over has doubled and even tripled for those over 65. There may be many reasons why these couples become part of the ‘gray’ divorce statistics, but the task of settling on asset and property division can derail retirement plans for residents in Florida and elsewhere.
Many couples may seek a dissolution once the children are raised and they realize that they no longer have common interests. Unfortunately, the decision to divorce may come at a high price once the division of assets is settled. The hardest area to recover from financially at this stage is in retirement planning. By the time people are in their 50s and beyond, it may be difficult to attain a higher income level or seek a better position in a different company.
One of the first things an individual can do that may prove to be beneficial is to retain the advice of an experienced professional who can help ascertain what one will need in order to retire. Likewise, when it comes to splitting certain retirement accounts, such as a 401(k), it is not a matter of simply writing a check to the former spouse as this can result in severe penalties and taxes. These types of assets require a Qualified Domestic Relations Order, and there are procedures that must be followed in order to split these funds without penalties.
In addition, many spouses may be tempted to surrender their share of certain assets in order to retain ownership of a home. This could prove to be a costly decision in the event one is no longer able to afford the upkeep in the future. A divorce is a difficult undertaking no matter when it occurs, and the prospect of facing a complicated property division settlement may feel like a monumental task. Florida residents may seek the wisdom and guidance of an experienced divorce attorney who can help an individual obtain the optimal settlement for one’s financial needs.
Source: The Washington Post, “A ‘gray divorce’ can devastate your retirement plans. Here’s how.“, Michelle Singletary, March 26, 2018