3 Things To Consider Before Getting Divorced After 60
Posted on: 20 March 2017
Going through a divorce is difficult at any age; however, these difficulties are often exacerbated if you get divorced after 60. As such, there are a few things you need to consider before signing the settlement papers:
How Your Retirement Funds Will be Affected
When you are few years out from retirement, chances are you will be doing everything in your power to increase your retirement fund and hold on to as much money as possible. However, separating from your spouse at an old age can put a significant dent in these reserves.
When a younger couple divorces, the courts look to see who is at fault for the separation and will allocate the couple's resources accordingly. Unfortunately, this process doesn't apply for older couples and your retirement fund will be effectively halved during the divorce. If you were the primary breadwinner in the relationship, this can leave a significant dent in your retirement package.
If you were not the primary breadwinner, you are legally entitled to part of the balance of your ex-spouse's employer-sponsored pension plan. This is the court's way of ensuring that you have ongoing security following the divorce. However, there are a few situations where accessing these funds can become difficult, which could potentially leave you with little or no savings. For example, your spouse's employer may make the payments solely to your ex-spouse, leaving you with a large legal case in order to receive your benefit. To protect against such cases, you must ensure you are protected by a Qualified Domestic Relations Order (QDRO). These orders ensure that your payment is protected and deposited into your account, which will give you the peace of mind when retiring from work.
How Your Assets will be Divided
Reaching an amicable conclusion on the division of marital assets is a major hurdle in almost every divorce; however, this process can be even more difficult if you divorce at an older age. The reason for this is that you will have owned your major assets, such as your home, for a significant period of time, and both parties often have a great deal of emotional attachment to these assets. As such, divorce proceeding can become extremely difficult if neither party is willing to concede ground during these discussions.
The main point of contention is usually the family home, as neither partner will want to give up their home without a fight. However, if you are looking for the best financial outcome, giving up the home is often the best way to go. The reason for this is that assets are often divided equally in the event of a divorce and property is often the most expensive asset up for grabs. As such, if you hold on to the house, your spouse will receive a number of other things to balance this out. This may be a larger share of the retirement fund, which can significantly reduce the amount of liquid cash you have to cover your retirement.
How Social Security will be Granted
Social Security is not considered to be an asset and, as such, the courts cannot divide payments in the event of divorce. However, the conditions of your marriage and subsequent divorce are relevant to the amount of benefit you are entitled to, so it's important that you know the rules prior to signing the settlement papers.
If you are over 62 years of age at the time of retirement and you were married to your spouse for over 10 years, you are entitled to benefits on your ex-spouse's Social Security record. In addition, you are entitled to higher payments if your spouse dies – in such scenarios, you may be entitled to up to 10% of your ex-spouse's Social Security benefit. These payments are made regardless of whether or not you remarry and can give you the safety you need well into retirement.
Talk to a divorce attorney for more information.
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