Divorce, especially during the later stages of life, can present a myriad of financial challenges that require careful consideration.
Whether retired or approaching retirement, making informed decisions safeguards your financial well-being during this significant life transition.
1. Asset division
Splitting assets acquired over decades can be intricate. Begin by working with your attorney to inventory all assets, including real estate, investments, pensions and retirement accounts. Assess the value of each asset. Remember, the goal is to secure your financial future, so prioritize assets that align with your retirement objectives.
2. Healthcare coverage
Healthcare costs can skyrocket as you age. If you had coverage under your spouse’s plan, you may need to explore alternative options.
3. Social Security benefits
Understanding how your divorce impacts your Social Security benefits is important. If your marriage lasted at least 10 years, you may be eligible for benefits based on your ex-spouse’s record. Carefully assess whether this option is more advantageous than claiming your own benefits, and pose any questions to your attorney.
4. Estate planning
Once your divorce is final, update your estate plan to reflect your new circumstances. Failing to update your estate plan can lead to unintended consequences.
5. Budgeting and financial independence
As you transition to a single-income household, creating a budget is necessary. Understand your monthly expenses and consider adjusting your lifestyle accordingly.
People 50 and older account for 36% of U.S. adults getting divorced and often face additional challenges. Planning ahead plays a key role in enjoying your golden years and feeling financially secure.