Gray Divorce Nearing Retirement
Divorce After 50 Lawyers in Creve Coeur & O’Fallon
Getting divorced can be one of the most challenging things you go through, but it may be especially hard if you are older and have been married for a long time. Divorce after 50, also called “gray divorce,” is not the same as a typical divorce. There may be several differences in the circumstances that may impact things such as retirement. At The Marks Law Firm, L.L.C., our experienced divorce lawyers recognize the challenges couples over 50 face during divorce – and we are focused on addressing the needs of our older clients. Our knowledge and understanding of the issues help us provide guidance and skilled representation to clients going through the process of a gray divorce.
Post-Divorce Estate Planning
Weighing Your Retirement Options
Retirement savings is a significant issue in divorce. It often makes up a substantial amount of a marital estate, particularly for couples who have been married for twenty or more years. However, most spouses realize the financial impact on retirement once it is almost too late.
Generally, a two-income household works to save retirement funds for the couple to retire together and, therefore, budget accordingly. When this couple divorces, those plans go entirely out the window. They must plot a new path forward where each spouse has a residence, fixed expenses, and some “play” fund. With essentially half the proposed saving, the revised plan will be much different than imagined.
In a household with only one income, the spouse not earning income must rely on the other spouse’s savings. Without it, that spouse faces a potentially dire financial future at retirement.
For a relatively younger married couple, retirement often seems very far away. As a result, who gets what percentage of the total retirement savings at divorce might not be the most important decision. Why? Because both spouses will most likely have enough working years left to establish significant savings for retirement. However, dividing retirement savings takes on much greater importance at divorce for a couple who has been married for over twenty years and is now approaching retirement age. Determining your percentage of the retirement savings portion of the marital estate can be complicated. We must discuss and consider your and your spouse’s current age, employment, employability, work history, and health. For example, if you have been married for at least 10 years, you can claim partial Social Security benefits using your former spouse’s work history once you reach age 62. Full Social Security benefits are available once you reach the retirement age set by federal guidelines.
We need to consider your expected monthly income, expenses, and whether you will receive or pay spousal maintenance. We must also consider other benefits you may need before you can safely decide whether to retire. For example, you might need to continue working to retain your employer-based health insurance benefit. You also must evaluate whether you can continue to work and, if so, in what capacity as it relates to your post-divorce goals.
Is Delaying Retirement a Good Choice?
The simple answer is “it depends.” Some at this age no longer want to work and wish to enjoy their retirement years. However, some may not be able to afford their retirement lifestyle post-divorce without working. If you lost a significant portion of retirement funds in the divorce, you might want to work additional years and take advantage of favorable laws that allow persons over 50 to save more in retirement plans such as 401(k) plans and Individual Retirement Accounts (IRAs). Working for longer will allow your retirement investments to continue to grow before disbursements begin. It can also increase the retirement benefits available to you through Social Security.
Contact Our St. Louis County & St. Charles County Gray Divorce Attorneys
If you are over age 50 and are thinking about divorce, you probably have questions about how the decision will affect your ability to retire. Call The Marks Law Firm, L.L.C. today at 314-993-6300 to discuss your questions and get the answers you need about the divorce process.
At The Marks Law Firm, L.L.C., our lawyers can also help you address many of the practical concerns associated with your gray divorce. Additionally, we provide guidance with drafting prenuptial agreements for individuals over 50 who are looking to get married again. Contact us today to schedule an initial divorce consultation. We look forward to hearing from you.
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