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How Grandparents Need to Plan For Divorce

Seniors are divorcing more than ever. And with less income sources and higher healthcare costs, financial planning in divorce is critical to survival. 

Divorce is always a trending topic when talking with sociologists- and lately the data’s been curving in some interesting new directions. In particular, grandparents are no longer immune from the divorcé title.

Since 1990 the divorce rate for Americans over the age of 50 has doubled, and it’s even greater for wedded couples over 65. If you know someone filing for divorce, there’s a 1 in 4 chance it’s a couple over 50. Almost 1 in 10 chance they’re over 64.

So common, in fact, it’s dubbed a “gray divorce.” There’s many hypotheses surrounding the spike, but one thing is certain: a college-education is not a factor, as is with younger newlyweds.

Also not following suit with the younger generation is the financial ramifications that may accompany gray divorces. Individuals may no longer be working leaving retirement savings and social security as the only income source; wives from this generation may have never held a job; assisted living, health insurance and “single” tax filing will undoubtedly lower income, as well.

But while finances should not outweigh happiness, it’s imperative seniors take a serious look at their finances before mingling in the single world again. Temecula divorce attorneys of Wilkinson & Finkbeiner offer a helpful guide for seniors preparing for divorce.



FISCAL REALISM: Unfortunately, growing old often means a diminishing revenue flow. Social security, pensions, annuities and savings are typically split between couples, leaving both parties without enough money to support their shared lifestyle. The best starting point for both seniors is to realistically breakdown their spending habits and income sources. From there, a financial and legal advisor can better direct the person down the appropriate divorce path.

“Divorce is one of those peculiar things that is sometimes greatly needed, yet rarely easy,” Temecula family lawyer Dave Wilkinson said. “Divorce typically includes tangled issues and unique circumstances that require careful maneuvering and attention to detail.” AKA, make your realistic fiscal plan before filing for divorce and serving your partner. Many of their clients wish they created a plan prior to opening the divorce talks.

YOU MUST PAY TAXES: And it’s probably going to feel like you’re leaving the IRS a hefty tip for their “services” after no longer being able to file jointly. There’s no way around this one, seriously; seniors would’ve figured it out long before they hitched.

Taxes should be carefully handled when splitting up retirement plans, as well. Tax penalties may occur when funds are transferred to new, individual, plans- but this can be avoided with Qualified Domestic Relations Orders (QDRO). These orders protect both husband and wife from owing taxes after transferring money, but if not properly written they are often useless. It’s best to have a qualified attorney look over these for you , at the very least.

CALCULATING SOCIAL SECURITY: Social security is a huge player in divorce negotiations, property division and spousal maintenance. If married for more than 10 years and at least 62, one party may be able to collect benefits from the other’s social security. There’s a lot of fine print here, including re-marriage and death details, hence its importance in negotiations.

PROTECTING YOUR HEALTH: If Medicare hasn’t kicked in yet and the senior shared health insurance under a family plan, one person’s is surely to skyrocket in price. While you may no longer want to share a home or bed, this is probably not an area you want to leave your former spouse worrying over. A popular way to avoid a gap in coverage or applying for new plans in old age is legal separation, rather than divorce. Legal separation legally distances the marriage but allows for health insurance, and other issues like tax and social security benefits, to remain intact (more information on differences between divorce and legal separationFind Article, here).


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Jen Mur writes on behalf of Wilkinson & Fikbeiner, a Family Law Firm based in Temecula and San Diego, California and Boston, Massachusetts. 

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