With the U.S. divorce rate consistently hovering between 40 and 50 percent, divorce is thankfully no longer a taboo subject. However, just because it’s more socially accepted to get divorced that doesn’t mean it’s easy or that individuals who choose to divorce won’t encounter difficulties along the way.
Individuals who divorce later in life are especially prone to experience financial problems as they near and attempt to figure out how to afford retirement. The results of a study conducted by researchers at Bowling Green State University revealed that, during the 22 years preceding 2012, the divorce rate doubled among individuals ages 55 to 64, who are nearing retirement, and tripled among those ages 65 and older, many of whom are already retired. For individuals in these age demographics, having a retirement savings cut in half can have significant repercussions.
A major hit to retirement assets can derail an individual’s plans to retire and may necessitate working longer or finding part-time work. Additionally, an individual’s retirement goals of traveling, joining a country club or moving closer to family may also have to be adjusted. For these reasons, it’s crucial that individuals age 55 and older who plan to divorce contact a divorce attorney.
A divorce attorney can provide advice about ways to maximize assets via 401(k) and IRA catch-up contributions as well as work to secure a divorce settlement that accounts for retirement funding. While divorce may force an individual to shift and rethink their retirement priorities, it can also free an individual from an unhappy and unhealthy relationship and open one up to many new future opportunities and possibilities.
Source: Forbes, “Easing The Financial Impact Of Divorce In Retirement,” Juliette Fairley, Jan. 22, 2016