Minnesota couples may be interested to learn that according to Bowling Green’s National Center for Family & Marriage Research, people over the age of 50 were twice as likely to get divorced in 2010 compared to 20 years earlier. While divorce can be financially devastating at any age, one of the main concerns for people in this age group is preserving their retirement.
Women may fare particularly poorly from a financial point of view with 41 percent experiencing a decline in income after divorce compared to just 23 percent of men. However, both men and women should assess their finances. It is important to note that some expenses will go up. For example, auto insurance rates may be higher for a single person.
One option might be delaying the divorce if it is worth doing so to get certain benefits. Most people 65 or older are eligible for Medicare, and this can be less expensive than many insurance options. Furthermore, if people have been married for 10 years or more, one spouse may qualify to draw Social Security on the other spouse’s earnings.
Retirement accounts are also generally divided in a divorce. There may be steps people can take to reduce or eliminate the tax burden from a retirement account distribution. Negotiating property division can be complex for divorcing couples of any age. Furthermore, there are a number of potential financial pitfalls. For example, a custodial parent, might be tempted to keep the family home and might even agree to give up other assets, such as their share of retirement, in order to do so. This can be financially disastrous because of mortgage payments and upkeep. Accordingly, people may want to obtain legal advice at this stage of the process.