Each divorce can have its own set of questions. Who gets the family home? How are the bank accounts going to be split up? And who gets custody of the kids? And while these are all legitimate concerns, it turns out that when people over the age of 50 decide to file for a divorce, they tend to be looking at a whole new set of concerns that those younger are most likely not faced with.
For one thing, with older couples, child custody may not be an issue – as the kids are now adults – but issues related to assets and what the children are being left with if someone were to pass away is still very important. For example, what if one of the former spouses gets remarried, and their new spouse has children? It’s important to make sure that the money that was originally intended for the children from the previous marriage still goes to them.
Then — aside from assets being left — older couples also face other financial concerns, as there was probably more time spent in the workforce; and in many cases a growing or quite large retirement fund. Often people make the mistake of thinking that a retirement fund is worth face value. However, since these types of accounts are normally taxed upon withdrawal, the actually amount is more around 65 percent of what the account’s statement claims.
This real amount valued at 65 percent less is important to keep in mind when reaching agreements in property division and assets, so that one person doesn’t end up receiving a lot less.
When looking at accrued amounts, it’s also important to remember that Social Security is a real asset, and that if two people were married for at least 10 years, one spouse is entitled to some of the benefits of the other after the age of 62 – as long as the one who is set to receive the portion doesn’t get remarried.
Overall these are just some tips to keep in mind when going through a divorce after the age of 50. In general the important thing is to make sure that literally all assets are accounted for when it comes to a divorce settlement, and that the true values of those assets are what is being measured.
Source: SmartMoney, “Divorce Over 50: 3 Mistakes to Avoid,” Catey Hill, 23 March 2011