What to consider, if divorcing after age 50

March 16, 2013

What to consider, if divorcing after age 50

Article provided by The Pilkington Law Firm, PLLC
Visit us at http://www.pilkingtonlawfirm.com

The number of couples divorcing in their 50s and 60s has more than doubled in the last 20 years, according to a study by the National Center for Family and Marriage Research at Bowling Green State University. The term 'gray divorce' has come to describe the new trend.

Bowling Green State University Professor of Sociology Susan Brown said they found that "back in 1990 fewer that one in 10 people who got divorced were over the age of 50, ... today, one in four people getting divorced are 50 and older." The study's researcher believes that over the new 20 years there will be a 25 percent increase in the number of those divorcing after age 50.

Couples who divorce later in life do not have as much time before retirement to recover financially and plans to retire may have to change. Property division and debt allocation need to be assessed carefully. A team including an experienced family law attorney and a financial planner may help you avoid costly mistakes.
Holding onto health insurance coverage

One major consideration for older couples is health insurance. While Medicare is available at 65 that could still be some years in the future. If you each have benefits available through your employer, the divorce will likely mean you can update your benefits and not have to wait for an annual enrollment period.

For couples, where one spouse is a freelancer or does not work outside the home, arranging health insurance becomes more difficult.

COBRA benefits are often available through an ex-spouse's employer-provided benefits, but these policies may be cost prohibitive. Individual insurance policies are another option that may become more viable in the near future. Several Oklahoma legislators are studying the option of an insurance exchange. While the Joint Committee on Federal Health Care Law adjourned last year without making final decisions, a majority of the members favor a state exchange of some sort. Work continues even after Oklahoma returned a federal grant meant to help them build the technical infrastructure of the program.
Apportioning retirement accounts

Being close to retirement age means a good portion of the assets are stored in retirement accounts and annuities. Depending on cash flow issues, there might be a temptation to cash out these investments. Caution is advised, because the tax consequences coupled with early withdrawal fees can put a large dent in what you receive.
Dividing equity in the home

Property division must also deal with the equity in your home, which is not a liquid asset. If you will not have a steady stream of income, you may not be able to afford to keep the home. Even if you do, will it be enough?

Options for dividing the equity in the home are a sale, refinance or buy out. As the housing market rebounds, selling a home is again an option. As values start to increase in property it is important to get a professional appraisal from a neutral party, so you have a good idea of the equity in the home.

Oklahoma uses an equitable distribution standard, which does not always mean property is divided equally. Neighboring Texas is a community property state. An experienced family law attorney can explain the differences between the two approaches and the impact on your divorce.

When considering divorce, contact an experienced Oklahoma family law attorney. Guidance from the beginning can be one way to avoid conflict and costly mistakes. An attorney will also ensure that your rights are protected throughout the divorce process.