Gray Divorce Brings Unique Challenges
Statistics show that gray divorce, or divorce among adults 50 years of age and older, is on the rise for multiple reasons. According to Pew Research, gray divorce has increased 109 percent over the past 25 years. If in the later stages of life and considering divorce, there are unique challenges.
While younger couples have plenty of opportunities to earn additional income and assets in the future, couples in their 50’s and 60’s are typically close to retirement or have already retired. With no new assets coming in, it can be difficult for soon-to-be exes to divide up the assets they have already accumulated. Fortunately, in community property states like Washington, this process can be straightforward as all marital property will be divided evenly between the spouses.
However, in equitable distribution states like New York, the process will begin with a valuation of all marital assets, followed by a determination by the court as to how to divide the assets fairly. There are also tax considerations to consider. For example, if a couple needs to make early withdrawals from their 401(k) due to their divorce, those early withdrawals may be taxed at a higher rate.
Older couples also need to consider the expenses they will face while living separately. And, divorcing couples generally need to deal with child custody issues, if they have young children. However, most older couples who have children do not have to deal with these issues as their children are typically adults by them time they decide to divorce. If there are young children, gray divorcees will have to consider that child support payments may affect their retirement schedule.