The term gray divorce means the dissolution of a marriage between two individuals who are at least 50 years old. The rate of gray divorce in the U.S. has doubled in the past two decades. Finances are one of older couples’ biggest worries after a divorce.
Financial reasons for gray divorces
For some couples, a gray divorce may occur because of financial changes. Changes that may contribute to a divorce include:
- Desire for financial independence
- Increased monetary struggles during the marriage
- Sudden autonomy and financial independence of a partner
- Desire to spend funds differently during retirement
Unique situations
In a gray divorce, you may face certain situations that impact your finances that other couples will not. Unique financial hurdles that may impact your gray divorce include:
- College tuition bills for your children
- Adult children who have returned home
- Blended families
- High medical bills
- Elderly parents’ care
Retirement funds
For people going through a gray divorce, retirement funds may make up the most valuable assets they own. The state of Florida allows these assets to be divided equally if the money in the accounts accumulated during your time together. If the retirement fund had a significant amount contributed before your marriage, the courts might not divide it equally.
Steps to reduce financial stress
A divorce later in life may take some adjustment to keep your finances under control. These steps may help you:
- Develop a budget.
- Examine new health care coverage that may save you money.
- Use apps and other technology to help track your expenses.
- Consider taking courses online to help you manage your finances.
Gray divorce has the potential to cause financial devastation. Yet careful and prompt planning can prevent this outcome and allow you to live out the rest of your life in financial freedom.