Unique Considerations Involved in a Gray Divorce
“Gray divorce” is a phrase that has gained popularity as the divorce rate among people over 50 years old has risen substantially in recent years. According to the American Bar Association, the 50+ demographic now accounts for about 25 percent of all divorces. Although the basics of divorce are the same regardless of age, there are considerations for older people that younger couples may not have to think about as much.
In a gray divorce, the spouses often have more complex financial situations, including large and diverse asset portfolios that must be divided, the prospect of diminished earnings and the need to plan for future individual living expenses and health and wellness care.
Here are some of the issues that can affect gray divorces in Georgia:
- Living expenses after a divorce always go up, because each spouse must establish and maintain a separate household. What’s more, assets may have to be liquidated to create an income stream.
- A spouse who has health insurance through their husband’s or wife’s plan will lose that coverage upon divorce and may need to pay higher premiums for their own coverage.
- Social Security payments could be less than expected, particularly if the marriage lasted less than 10 years.
- Older couples may have several different retirement assets, such as multiple 401(k)s, IRAs or pensions. Dividing those types of accounts requires special steps to avoid penalties.
- Spouses who are over 50 but not yet able to retire may need to reenter the workforce, which can be a challenge due to ageism and gaps in employment.
In addition, older couples need to think about estate planning in conjunction with their divorce. You may have created a will, trust or other estate planning document over the years and those plans most likely include provisions for your spouse. It is a good idea to revisit these documents during the divorce process and to revise beneficiaries and bequests.
Similarly, your spouse is probably named as the beneficiary on insurance policies, property deeds, payable-on-death bank accounts and other documents. Don’t forget to update these documents to name a different beneficiary. Otherwise your ex-spouse will still be in line to receive assets from you in the future, long after your divorce.
At the Law Office of S. Mark Mitchell, LLC in Newnan, Georgia, I have successfully represented 50+ clients who have decided to end their marriages, so I understand the unique issues that arise in gray divorce. If you would like to understand more about how I can help, call 470-344-8550 or contact me online to arrange a free initial consultation.