3 Financial Issues That Can Complicate Your Gray Divorce
In the last 20 years, there has been a record surge in the number of gray divorces being filed by Americans on the brink of retirement. A “gray divorce,” or a “late-life divorce,” refers to older spouses to decide to separate after decades of marriage.
Couples often file “gray divorces” for the following reasons:
- They’ve grown apart and no longer connect emotionally
- They have conflicting opinions about spending or saving money
- They want to develop romantic relationships with new people
- They have incompatible sex drives
- Their relationship is strained by lingering resentments and unresolved issues
- They have vastly difference lifestyles
If spouses aren’t careful, a gray divorce can be catastrophic for their individual finances. To help you prevent this scenario, the New Port Richey divorce lawyer at Dale L. Bernstein, Chartered Law Office has compiled the following summary of information.
Issue #1: The Question of Alimony
Americans are living longer, which means that the age of retirement keeps getting pushed out. If at least one spouse is still working during a gray divorce, the lower-earning spouse may be entitled to spousal support payments. Of course, the court needs to consider many factors before awarding alimony, including: the length of the marriage, each spouse’s marital contributions, their retirement age and earning capacities, and the condition of their marital estate.
The paying spouse may want to consider a lump sum payout if they don’t have access to regular wages. After all, who wants to start a brand-new career just to afford their spousal support payments?
However, the lower-earning spouse may decide to negotiate for retirement assets over alimony. Roth IRA and Roth 401(k) are two retirement options that are funded by after-tax dollars. This means that the receiving spouse doesn’t have to worry about their payments being heavily taxed.
There are many financial circumstances that can impact your post-divorce life. Before making any important decisions, you need to discuss your financial and legal situation with a qualified attorney. At Dale L. Bernstein, Chartered Law Office, our attorney can help you explore your options and devise a negotiation strategy that aims to safeguard your standard of living.
Issue #2: Asset & Property Division
A marital settlement agreement is an important legal contract that stipulates the terms of a couple’s divorce. Before spouses can legally part ways, they first need to reasonably and fairly divide their shared marital estate. This can be quite the endeavor for couples who have spent 35+ years together. Unfortunately, this also means that the equitable distribution of property probably won’t be a 50/50 split. Your best chance at negotiating a fair marital settlement agreement is to work with a knowledgeable and persistent attorney. Otherwise, you and your spouse may be at the mercy of the court.
The court determines asset distribution based on:
- The duration of your marriage
- The income of both parties
- The age and health of both spouses
- The extent of your community and separate debts
- The value of any community and separate properties
At Dale L. Bernstein, Chartered Law Office, our attorneys can review your marital estate and negotiate on your behalf both in and out of court.
Issue #3: Don’t Pass Up Your Ex’s Social Security Benefits
You need to consider your current and potential financial situation before filing for divorce. After all, you want to live your golden years in financial stability and relative comfort. After a divorce, you may be able to claim benefits based on your former spouse’s earnings record.
However, this option is only applicable if:
- You and your ex are over the age of 62
- You’ve been married for at least 10 years
- Your ex is already claiming Social Security benefits.
If you meet these criteria, you may be eligible to collect up to half of your former spouse’s Social Security retirement benefits. Even better, you may be able to receive your ex’s benefits now and delay receiving your own until you reach Full Retirement Age. However, if your ex hasn’t filed for benefits yet, then you may need to wait 2 years before you can file as an “independently entitled spouse.” Either way, it’s crucial that you discuss Social Security benefits and regulations with a legal representative prior to your divorce.
Retain Experienced Legal Representation Today
Contact the New Port Richey divorce attorney at Dale L. Bernstein, Chartered Law Office if you’re interested in filing for a gray divorce. Our experienced legal team can answer your questions, address your concerns, and represent your interests throughout the negotiation process. With our help, you can secure a marital settlement agreement that reflects your legal and financial objectives.
Contact Dale L. Bernstein, Chartered Law Office at (727) 312-1112 to schedule a consultation.