Gray Divorce - Greatest Financial Impact on Women

The Rising Trend of Divorce After 50: What You Need to Know

Here's something surprising: more and more people are getting divorced later in life. In fact, divorce among people over 50 has doubled since 1990. Even more eye-opening? When you look at folks over 65, that number has tripled. Back in 1970, only about 8 out of every 100 divorces involved people over 50. Now? It's jumped to 36 out of every 100. That's a huge change!

Why This Matters, Especially for Women

Let's be honest - divorce is tough on everyone's wallet, but it can hit women particularly hard, especially those who are older. Think about it this way: many women from older generations followed the traditional path of staying home while their husbands worked. This means they might have spent decades out of the workforce, making it much harder to jump back in now.

Persistent Wage Gap for Women

Women also tend to earn lower incomes than men due to a persistent wage gap; they tend to have less savings, and near-retirees who are divorcing don’t have much time to make up the difference. Divorced women can claim a Social Security benefit based on their own earnings or a former spouse’s earnings history, but the latter option is generally worth only up to half of an ex’s benefit. Remarrying or cohabitating generally helps bolster one’s finances via pooling of resources. But women who undergo gray divorce are less likely to do so than men: Only 22% of women re-partnered in the decade after gray divorce versus 37% of men, putting them at “sustained economic disadvantage into old age,” according to a separate report.

Standard of Living Decline

It has been reported that when couples split up, women typically see their household income drop by anywhere from 23% to 40% in just the first year after divorce. That's like suddenly having to make do with only two-thirds or even half of what you're used to living on. For younger women who've had careers, this hit isn't quite as severe. But for those who've been homemakers most of their lives? It can be devastating.

These negative economic outcomes persisted over time, “indicating that gray divorce operates as a chronic economic strain.” Poverty levels among women old enough to qualify for Social Security retirement benefits are almost twice as high for women who divorced after age 50 as those who divorced before age 50, however; the same isn’t true for men. Here are some steps women can take to protect against the financial pitfalls of a potential future divorce, according to financial advisors.

Women Should Be Involved In Household Finances

So what can you do to protect yourself? Here are some straightforward steps:

Get involved in your money matters now. Don't wait until there's a problem. Know what you spend, what you save, and what you owe. Think of it like this: you wouldn't let someone else make all the decisions about your health, so why let them make all the decisions about your money?

Have your own money. Even if you share accounts with your spouse, make sure you have some money that's just yours. This includes having credit cards in your name, not just as an authorized user on your spouse's cards.

Retirement Planning

Be smart about Social Security. If you're married and approaching retirement age, work with your spouse to maximize benefits. For example, if your husband can wait until age 70 to claim Social Security, it could mean a bigger benefit for you later if you end up divorced or widowed.

Save some of your alimony. If you receive alimony after divorce, try to save some of it instead of spending it all. Remember, alimony usually doesn't last forever, so you need to plan for the future.

Final Thoughts

Consider a legal agreement. If you're getting married or already married, think about getting a prenuptial or postnuptial agreement. This is especially important if you plan to leave your job to raise children. Think of it as insurance - you hope you'll never need it, but it's there if you do.

The Bottom Line

If you're facing divorce after 50, make sure to work with a lawyer who specializes in helping older adults through divorce. They'll understand the unique challenges you're facing and know how to protect your interests. Remember, the decisions you make during your divorce can affect your financial well-being for years to come, so it's worth getting expert help to get it right.

This isn't about being pessimistic - it's about being prepared. Just like you'd want a good insurance policy to protect your home, you want to protect your financial future too. Taking these steps now can help ensure you're ready for whatever life brings your way.

This crucial assignment calls for the assistance of a seasoned professional. Since this isn’t a typical case, you should seek a lawyer who specializes in senior divorces. The person you choose to represent you now will have a major impact on your life years from now.

If you are thinking of, or in the middle of a divorce, we want you to know you're not alone and we’re here to help. If you would like to discuss how we can assist you with your future plans, please give me a call at 469-556-1185.

Geni Manning

Disclaimer: The information provided in this website and our blogs is not intended for legal, financial or mental health advice but is for general informational purposes only. While we endeavor to provide the latest information on a particular subject, future changes to the source Information is beyond our control.