Gray divorces involve spouses in their fifties or later who have likely been married for many years. Changes in their priorities, infidelity or empty nest syndrome might contribute to them feeling dissatisfied in the marriage and ready to move on with their lives.
It is common for spouses to worry that they cannot afford a comfortable retirement if they divorce later in life. Gray divorces often create financial pressure on those getting ready for retirement, but they usually do still have the option of retiring after the end of the marriage.
How can those navigating a gray divorce work to ensure their comfort in their golden years?
Properly dividing retirement accounts and pensions
Many professionals save for years to afford retirement. They may make pre-tax contributions to special savings accounts or may accrue pension benefits by maintaining a job with the same company for years. Contributions to pensions or retirement savings accounts during the marriage are likely subject to division. Spouses can directly divide accounts using special paperwork in some cases. They can also arrange for routine payments from one spouse to the other during the retirement years if dividing the resources directly isn’t an option.
Delaying retirement or working part-time
Rebuilding retirement savings and paying off debts can help those who divorce later in life ensure their comfort in the future. For some people, delaying retirement by a few years and continuing to work full-time could be the best option available. They may be able to save aggressively during those last years of employment and replace much of what they had to give up in the divorce. Others may move forward with their planned retirement but may seek out part-time employment. Some professionals might even be able to work as independent contractors or consultants and command competitive wages in the early years of retirement.
Accessing key benefits
Some people rely on their spouses to provide or supplement retirement benefits. Most working professionals can qualify for Social Security retirement benefits if they spend much of their adult lives employed. They can also qualify for Medicare insurance coverage. Dependent or lower-earning spouses who divorce can potentially still qualify for benefits based on an ex-spouse’s employment history in many cases. Provided that the marriage lasted at least 10 years, they can qualify for benefits using their spouse’s employment history or supplement their own Social Security retirement benefits based on what their spouse accrued.
Planning carefully can help people end an unhappy marriage and still retire with dignity afterward. Spouses who worry about retirement after a gray divorce may need help achieving their retirement goals despite divorcing. Seeking personalized legal guidance is a good way to start.
