As people start to live longer and healthier lives, the desire to spend their golden years in happiness becomes a top priority. This realization is leading many retirees to reconsider their marital situation. However, older adults must be aware of the challenges of a grey divorce before taking such a big leap.
Grey divorce refers to the rising trend involving couples aged 50 and up, who have decided to part ways after long years of marriage. Though it presents newfound freedom, many older adults who divorce in their sunset years face unexpected financial hurdles.
Divorce could take a dip out of your retirement savings
Grey divorce could take away the years, or even decades, spent building a nest egg. In Tennessee, divorce courts require a fair division of assets, including retirement assets such as pensions, 401(k) or IRA. That could leave one spouse with half or less than what they anticipated enjoying in their golden years.
At an age where reentering the workforce is a daunting challenge, a significant dip in retirement savings could make navigating life after divorce very difficult.
Divorce could expose financial infidelity
Surprisingly, a number of couples in long marriages have never really had the money talk while they were younger. It is only when they near or are in retirement that they realize how financially incompatible they truly are. In all those years, one spouse could’ve been hiding debts, a gambling problem or a secret bank account.
Divorce can put a spotlight on each party’s finances. It can reveal financial infidelity, where a spouse hides financial information from the other. Apart from making it difficult for the unaware party to secure a fair share during property division, financial infidelity can also foster animosity toward the secretive spouse.
Divorce may require a lifestyle change
One of the unanticipated side effects of divorce is the need for a lifestyle adjustment. A person accustomed to sharing costs or was financially dependent on their spouse may find transitioning to a solo living situation especially difficult.
Life post-divorce can open up a person’s eyes to the realities of their costly living expenses or health insurance premiums. Driven by necessity, they could be forced to move to a smaller home or reduce their daily expenses.
Take steps to safeguard yourself in divorce
With less time to bounce back from the aftermath of divorce financially, it becomes pivotal that they take steps to understand their rights and protect their assets. A key strategy to achieve this is by enlisting a divorce lawyer’s help before making any major decisions. With legal guidance, those considering a grey divorce could better brace themselves from unexpected monetary difficulties.