Financial Checkup: Preparing for a Grey Divorce
The rise of “grey divorce” – the dissolution of marriage among couples aged 50 and older – has emerged as a significant demographic trend in recent decades. While ending a long-term marriage is emotionally challenging at any age, the financial implications of divorcing later in life can be particularly complex.
Assess Your Current Financial Position
Begin by gathering all financial documents, including bank statements, retirement accounts, investment portfolios, insurance policies, and property deeds. Create a detailed inventory of both joint and separate assets. This step is crucial as longer marriages often involve intricate financial entanglements and accumulated wealth.
Retirement Planning Considerations
Retirement savings require special attention during a grey divorce. Consider:
- Division of pension and retirement accounts through Qualified Domestic Relations Orders (QDROs)
- Social Security benefits and eligibility for spousal benefits
- Adjusting retirement timelines to accommodate new financial realities
- Revaluation of investment strategies to match single-income goals
Housing Decisions
The family home often represents both significant emotional and financial value. Evaluate:
- Whether keeping the house is financially feasible on a single income
- Tax implications of selling or transferring property
- Downsizing options and associated costs
- Mortgage refinancing possibilities
Insurance and Healthcare Planning
Health insurance becomes a critical consideration, especially if one spouse has been covered under the other’s policy. Address:
- Options for continuing health coverage post-divorce
- Long-term care insurance needs
- Life insurance policy beneficiary changes
- Disability insurance requirements
Support Resources
United States Resources:
Canadian Resources:
Looking Ahead
Grey divorce requires careful attention to financial details, as the stakes are higher and the recovery time shorter than for younger couples. Taking a methodical approach to financial planning can help ensure a more secure post-divorce future.