A recent study by the National Center for Family and Marriage Research found that the divorce rate for Americans over the age of 50 has more than doubled in the last 20 years. Divorcing in later life brings a whole new set of challenges, chief among them the devastating impact it could have on your retirement plans.
Most divorces end with a 50-50 split in retirement assets, but the kind of assets and how they are being divided is important for both parties to consider. While it may be tempting to take the cash and leave the other party with the pension, you need to consider the tax implications as well as the long-term benefits. It may be better to split both the cash and the pension equally.
Financial experts advise those going through a late-life divorce keep these things in mind:
Don’t make decisions based on sentiment. You may love the house, but getting emotionally attached to assets can lead to big trouble for your retirement. Make sure you focus on the goal of leaving your marriage in a good financial position for your new life and a good plan for the long-term.
Protect what’s important. Make sure all your insurance policies are up to date and are adequate to meet your needs. If you are now the sole breadwinner for your family, look into disability insurance and be sure you have good life insurance as well.
Focus on the future. While divorce is always challenging, try to keep your eye on the prize of ensuring you have a good plan for moving forward, both emotionally and financially.
The Flanigan Law Group provides Southern California residents with personal attention for estate planning, administration and litigation legal services. When disputes between families, arise, they are very successful in resolving legal estate issues quickly and efficiently while preserving financial and emotional resources. Contact the Flanigan Law Group at 949-450-0041.