For older adults who are going through a divorce, it is important to consider the financial realities and how the divorce can impact retirement planning. Many couples work jointly to plan for retirement and may have originally planned to retire around the same time, but the end of the marriage could call those plans into question.
This is important to consider because there has been a trend of empty-nest divorce cases. Many couples become empty nesters in their 50s, depending on when their children were initially born. But after the children move out, they decide to end the marriage. At this point, retirement age is fast approaching, and steps must be taken to protect their future.
Splitting up retirement benefits
For example, there are some cases where one spouse has been earning retirement benefits from their employer. A qualified domestic relations order, or QDRO, may need to be used to split up these benefits. If they qualify as a marital asset, they can be divided in the years after the divorce, once that spouse officially retires.
Splitting up financial assets
But it is often true that couples are also privately saving financial assets for retirement. They may simply have savings in a bank account. They may have set up an investment portfolio together that they have both been contributing to. When these qualify as marital assets, it is crucial to know how to divide them and who has a right to them in the divorce.
The financial complexities of a divorce at this age can certainly make the process complicated, which is why it can help for these couples to work with an experienced divorce attorney.