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A closer look at some financial concerns associated with 'gray divorce'

While most of us tend to associate divorce with younger couples, recent statistics show that their older counterparts are actually outpacing them in this area to a considerable degree. Indeed, researchers at Bowling Green State University have determined that the divorce rate has increased by 50 percent among couples over 50, and by more than 50 percent among couples 65 and older since 1990.

Interestingly enough, experts indicate that these so-called gray divorces present serious financial concerns for women owing to a number of factors, including their likely being out of the workforce for years -- if not decades -- due to now-antiquated social mores and their propensity to live longer than their former spouses, to name only a few.

While this potentially limited ability to renter the workforce, reduction in retirement savings and need for more funds to cover a longer lifespan is understandably alarming, experts indicate that there are certain steps that women in these situations can take to help address these concerns and protect their post-divorce financial interests.    

Secure records

Experts indicate that the hiding of assets is surprisingly common in gray divorces, with husbands resorting to everything from secretly removing high-value objects from the martial home to concealing funds in accounts held by third parties.

In light of this reality, experts encourage women to make copies of any and all financial statements (including the last three years of tax returns) whether found in files or on the family computer, and also making a video recording of all household belongings.

Those women looking to leave a higher net-worth marriage, argue experts, should also seriously consider retaining the services of a forensic accountant to help uncover all available assets.

Carefully consider assets

While their spouse may be willing to part ways with the marital home, experts warn women to give this serious consideration, as taking on a residence on their own can prove to be very costly in the long run.

That's because a non-liquid asset like a home not only comes with a diminished cash flow, but also property taxes, upkeep expenses and even mortgage payments.  

Indeed, they recommend that the focus should perhaps be more on securing a larger share of retirement accounts, more substantial alimony payments or perhaps a life insurance policy on their soon-to-be ex.

Think about taxes

Finally, experts urge women to think about the always important issue of taxes when discussing property division and alimony. That's because 1) alimony is considered taxable income, and 2) certain property, like brokerage accounts, may come with very steep capital gains taxes.

What all of this really serves to underscore more than anything is that those women -- and men -- who find themselves ready and willing to pursue a divorce later in life should seriously consider speaking with a skilled legal professional who can guide them through this inherently complex process, answering their questions, explaining the law and protecting their rights.  

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Goddard & Malmquist
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