By Nelson Garcia, Esq.
A “gray divorce” refers to divorce among seniors (50 and older) after a long-term marriage, typically at least 20 years. However, that period can be shorter for older seniors (typically at least 65). Among facts that would surprise most people (from recent studies on the subject, like by the Pew Research Center and Bowling Green State University) and tips for addressing typically related risks are the following:
Surprising Facts About Gray Divorce
- Since the 1990s, the divorce rate for adults 50 and older in the United States has roughly doubled, and for adults 65 and older, the divorce rate has tripled.
- Over 10% of all people 65 years and older were divorced in 2018.
- Poverty levels for gray divorcees are about 19%, relative to 1% to 3% for married seniors and 13% for widowed seniors.
- The divorce rate for adults ages 50 and older in remarriages is double the rate for those who have only been married once.
- A significant share of gray divorces occurs among couples who have been married for 30 years and longer.
- Did you know that in states with no state income tax, like Florida, that Social Security retirement benefits, pension income, and income from an IRA or 401(k) are all untaxed?
Addressing Risks Related to Gray Divorce
As planning for a gray divorce can be overwhelming at virtually any income level, from both a legal and financial perspective, I recommend that you first consult an experienced, very competent divorce attorney such as the attorneys at Andalman & Flynn, who will expertly advise and guide you as to your legal rights concerning divorce, such as to property division, alimony, and other legal aspects applying to your situation.
I also recommend speaking with a financial advisor. Unless you already have a brokerage account with an investment company (such as Merrill Lynch, Charles Schwab, etc.) that offers such services, try to obtain a referral from a trusted friend or family member. You can also search online for a financial adviser in your area. In addition, the family law attorneys at Andalman & Flynn, as part of your initial consultation, can refer you to an experienced, reputable financial adviser after considering your situation.
Become knowledgeable about how the most common financially available resources, other than your primary liquid and other assets (such as bank and investment accounts, equity in home/real property), are likely to apply to you at or near retirement age. These include Social Security and Medicare, retirement savings, and long-term care.
Among the most important considerations are how best to ensure a good income stream and access to funds when needed and making adjustments in your daily living regarding them. However, a financial adviser would advise you of certain nuances that people do not commonly know. One example would be that, although you are not eligible to receive Social Security in retirement if you did not work at least 10 years, gray divorcees may qualify for benefits based on their spouse’s earning history if they were married at least 10 years, even if they have not worked for a full decade.
Suppose that, after the above consultations or your research, you find that the divided assets may not be enough for both you and your ex to maintain the same standard of living throughout retirement. In that case, other options to consider are: one or both spouses delaying retirement where possible, moving to a more retirement-friendly area with lower taxes and cost of living (like Florida), or otherwise reducing their standard of living.
In addition to the financial insecurity that can be associated with a gray divorce as stated above, as marketwatch.com recently reported: “Statistically speaking we’re healthier and probably going to be living a lot longer — possibly 30 years longer — than average retirees once did.” This further heightens the need for smart financial planning in the event of a gray divorce.
One critical aspect of gray divorces is figuring out how to divide an employment-sponsored retirement plan. The attorneys at Andalman & Flynn can help you with this as well.
If you have questions or need compassionate legal guidance regarding a divorce matter, please contact me, Nelson Garcia.
About Andalman & Flynn, P.C.: Founded in 1998 in downtown Silver Spring, Maryland, Andalman & Flynn has forged a distinguished reputation for legal excellence. The firm represents individuals seeking disability benefits throughout the country and practices family law throughout Maryland and the District of Columbia. The firm focuses on cases that impact the rights of everyone, and are there for clients when responsive legal help is most critical. The firm has provided legal analysis on national and local television and radio, and their attorneys often testify before legislative bodies and are routinely invited to contribute to prominent legal publications. For more information about Andalman & Flynn, please visit the website at andalmanflynn.com or call 301.563.6685