The choice to end your marriage will affect many areas of your life, including your finances. If you are near retirement or age 50 and up, divorce could seriously affect your plans for your golden years. It is beneficial for you to consider how your divorce will continue to impact you for years to come, which could allow you to make choices that will be beneficial and prudent long-term.
A divorce between two people age 50 and up is a gray divorce. When a younger Colorado couple ends their marriage, both parties may have decades to recover financially and save for retirement. However, when you are nearer to retirement age and take this step, you could lose up to half of your long-term savings. This is a serious financial setback, but it does not necessarily mean you must put all of your hope and dreams for your retirement years on hold.
You could make certain choices during your divorce that will allow you to protect your wealth and secure your interests long-term effectively. When considering your post-divorce financial health, it may be beneficial to carefully consider the following factors as you make choices and negotiate a final order:
- Will you have to pay alimony, or will you receive alimony after divorce?
- Have you received an inheritance since you married?
- How will you and your spouse divide any marital debt?
- What will happen to your marital assets?
In a gray divorce, it may be prudent to try and settle out of court. This will allow you to custom-tailor a solution that will make sense for your individual situation and financial objectives. During this process, you would be wise to avoid letting your emotions motive your decisions as this will probably not lead to solutions that will make sense long-term.
The end of your relationship does not mean it is also the end of your dreams for your retirement years. While it will take preparation and careful decisions, it is possible to secure terms that will provide you security and stability for years to come. Before you agree to terms or make any decisions that could affect you in the future, you may find it helpful to consider the big financial picture and what will set you up for success now and for years to come.