When boomers divorce — what are the financial implications

Source: www.bizjournals.com

Image result for scott ferris lawyer 


When boomers divorce — what are the financial implications

It can be a shock when that couple you’ve known forever announces they are divorcing. The news can be even more surprising or upsetting when the couple has been married for decades.

Divorce near or at retirement is more common than you might expect. A study from Bowling Green State University found the U.S. divorce rate for couples age 50 and older doubled between 1990 and 2010, and was even higher for those over 65.

For baby boomers, there are special financial implications when considering a divorce. There are unique emotional considerations, as well.

  • Will you have enough income? Except for the relatively few couples who have more than enough income to go around, paying for two households with the same income that formerly supported one can present challenges. Now, imagine both parties are about to see a drop in their income because of retirement. Sound stressful?

Even the process of divorce can be costly. I encourage clients to consider mediation, which typically is less expensive and contentious than a court battle.

In mediation, a mediator assists the couple to reach an out-of-court agreement that divides and distributes their marital property and, if applicable, settles spousal support claims. As an alternative to a contentious court battle, mediation sets a calmer tone than going to court and can make a difference in how the whole family reacts to the divorce.

  • Review your will or estate plan, life insurance policies, and other documents with appropriate experts. You may need to make important changes in your beneficiary and other designations. Chances are you don’t want your estranged spouse to remain on your healthcare power of attorney and make health decisions on your behalf. It’s also important to get your family law attorney’s input on changes to your estate plan during separation or divorce to assure support and property claims are addressed.

Going through a divorce without having your estate plan and beneficiary designations reviewed can be disastrous. There was a recent case where the husband died without properly removing his estranged wife as beneficiary under his life insurance policy. The estranged wife, as a result, received a substantial sum under the policy as the husband’s beneficiary. The husband did not want his estranged wife to benefit, but he never took the steps to protect his financial interests.

  • Grandma and Grandpa are divorcing! Boomer couples sometimes underestimate how anxious and upset their adult children may be at the news. Talk with your financial advisor and attorney before you tell your adult children of your plans. That will help the children know you aren’t floundering and have a plan in place for the future.
  • Think ahead if you’re a boomer getting married. Premarital agreements are valuable legal tools to protect your estate for your children from a prior marriage or other relatives. These agreements can resolve how to handle distribution of property upon divorce or death.

Careful planning before entering into a marriage may save you or your heirs from expensive and painful litigation. An attorney can advise you whether a premarital agreement is feasible and recommended in your situation. If a premarital agreement is warranted in your case, it can protect your property, whether presently owned or acquired in the future, as well as settle your future spouse’s claims against your estate.

How the Law Office of Scott A. Ferris, P.A. Can Help

If you, a friend or a family member find themselves in a situation such as this, please call the Law Office of Scott A. Ferris, P.A. at 305 670-3330 right away. Scott A. Ferris, Esq. is a licensed family law attorney who has been practicing law since 1987. He is available whenever you need him to defend your rights. Please learn about our firm at www.FerrisLawFirm.com.

Republished by the Law Office of Scott A. Ferris, P.A.

Related Posts:

Written by

No Comments Yet.

Leave a reply