Any divorce is stressful, but one filed later in life can cause serious repercussions: emotionally, physically and financially. A bad marriage is no recipe for success either.  However, depending on your situation, perhaps your spouse and you can live separate lives while avoiding the financial harms some divorces inflict.

The harm done by divorcing after age fifty, often called “gray divorce,” is bolstered by new research, according to Bloomberg. As greater numbers of Baby Boomers divorce, some for the second or third time, the finances of the newly retiring and retired suffer – at the least affordable time.

• If you get divorced after fifty, expect your wealth to be cut in half.
• Women divorced after age 50, on average, see their standard of living cut by 45%, about twice the decline found in younger divorced women.
• Older men see their standard of living drop 21% after a divorce. Statistically, divorce has a small effect on young men’s incomes.
• Ten years after a divorce, older people generally see no appreciable recovery in wealth or standard of living.  This is disturbing.
• Older Americans don’t have the time needed to rebuild the financial destruction caused by divorce. Women who spent their lives caring for children often find it difficult to re-enter the workforce and recover their financial capacities.
• American women 63 and older who divorce later in life have a poverty rate of 27%. That’s higher than any group at that age, including widows. That is more than twice the rate of similarly situated men and nine times that of married couples.

Since 1990, the rate of divorce after age 50 has doubled in the U.S. Baby Boomers’ divorce rates, along with the overall aging of the U.S. population, means we will see many more gray divorces in the future. If the rate of gray divorce stays as it is now, it’s estimated that more than 828,000 Americans will be divorcing each year by 2030.

That’s nearly 30% higher than the rate of gray divorce in 2010 and four times the 206,000 older people who divorced in the US in 1990. This data predicts that hundreds of thousands more Americans, mostly divorced older women, will be impoverished or barely scraping by financially in the near term.

Given these statistics, older married couples who feel divorce may be necessary should consider ways to live separate lives with the least financial damage. If the two are living in two different places, that doubles the cost of living, but avoids the cost of unwinding the couple’s finances. For example, if a person is fifty or older and covered by health insurance provided by the spouse’s employer, it may be impossible to find affordable replacement coverage if a divorce occurs.

Parties may decide to stay married in name but live permanently under a Separation Agreement.

Others may wait until both are Medicare eligible before formalizing a divorce, to maintain otherwise expensive health insurance.

Yet others may act cooperatively and seek out and follow sophisticated financial, tax, long-term care, and estate planning, even if they know divorce is inevitable.  Couples who cooperate protect their children’s future wealth, instead of spending it on legal fees and costs.  Cooperation pays major dividends, in our experience, whereas even modest contention tends to sap the marital estate and cause both parties to lose valuable focus.

Alternative Dispute Resolution (ADR) – negotiations, mediation, arbitration, and collaborative law – can save parties literally hundreds of thousands of dollars over a litigated approach, although sometimes litigation is the best way to go under the particular circumstances (mental illness, theft of assets, or other good cause).

If you’re older and considering a divorce, contact our office right away. We can talk about your situation, including your finances, and discuss your process options and how each can impact you. Divorce may greatly limit your financial resources, but that may not be a good enough reason not to get divorced, especially if you’re living in an abusive relationship.

We will listen to your facts, explain the law, and suggest approaches that are right and reasonable for you.  We are compassionate counsel and tough advocates.  Call us at 609-683-7400, or contact us online, to schedule a near-term initial consultation at a reduced fee.  We are conveniently located in Central Jersey’s Kingston community. Call today.  You will be glad you did.