How to Protect Your Finances in a Later-In-Life Divorce
There is no such thing as a good time to get a divorce. Divorce by its very nature signifies the end of something that was intended to last a lifetime. Getting divorced when over the age of 50 and after many years of marriage can be extremely difficult. Coming up with a settlement agreement that will protect your financial future will require advanced thought and planning, but it can be accomplished.
Here are a few tips for how:
Keep a Level Head
It can be challenging to keep a levelheaded approach to divorce, especially if the married couple has been together for decades, raised a family together, and owned a home or business together. However, the chief executive of International Capital Management Group recommends that divorcing individuals view the divorce as if it were a business arrangement. If a couple is able to look at dividing assets in an objective way, and not in an emotional way, the faster it will be for them to finish the divorce and move on with their lives.
Bring in a Mediator
Some couples are able to mediate their divorce on their own. However, the vast majority of couples will need an impartial third party to help them. The benefits of using a financial adviser in this role is they can objectively review all assets, create an accurate value of the assets, and then take steps to divide the assets between both parties in an equitable way.
Openly Speak About Debt
It can be a big surprise for divorcing couples to find out that one of the two individuals has secret debt. In states that have community property laws, a spouse is responsible for half of their spouse’s debt, even if that debt is not in their name. For this reason it is a good idea to get a credit report prior to filing for divorce. This removes any surprises that might occur during the negotiations.
Review Your Estate Planning
Current wills and estate plans will need to be revisited after divorce proceedings. Both individuals should take steps to minimize the financial impact the divorce will have on inheritance. Adult children who receive financial assistance from divorcing parents should have realistic expectations about what they will receive after the divorce. It is more expensive for two individuals to maintain separate lifestyles than it is for a married couple to do so.
Review Healthcare Insurance
Older adults often have health issues. The stress of divorce may exacerbate these issues. After the divorce, one or both spouses may find that they no longer qualify for the health insurance they had while married. Any settlement agreement should take into consideration ensuring adequate long-term health care.
Getting divorced later in life is a challenge. However, with appropriate planning and forethought, the difficulties of a later-in-life divorce can be minimized.
Posted in: Finances