In the past, couples spent their golden years basking in the glow of retirement. They would spend their days playing golf or tennis or sitting in their rocking chairs on the front porch, without a care in the world.
This is no longer the case for many couples with plans to retire in the near future. Instead of enjoying their retirement, they are spending their days working with lawyers to finalize their divorce.
It was once assumed that a couple that had been together for decades would stay married for life. That is no longer the case. People are living longer than ever. A person in their 60s today could still live 20 or 30 more years, and many are discovering that they do not want to spend 20 or 30 more years with their spouse.
This has sparked the gray divorce trend, which has seen a huge uptick in the number of divorces among married couples in their 50s and older. These couples are affected the most by divorce, as many are having to delay retirement and even work multiple jobs in order to afford a new lifestyle after splitting their assets in a divorce.
In fact, getting divorced later in life can be extremely hazardous to one’s health and finances. This is especially true for homemakers who have never worked and suddenly find themselves single, without any money to call their own. Here are some of the effects of gray divorce.
Gray divorce is associated with a huge drop in wealth. A couple in their 50s and beyond that plans to divorce can expect their wealth to drop by 50%, especially for women with children still at home. Older men see their wealth drop by more than 20%.
While divorce can cause financial ruin at any age, younger couples who divorce have an advantage because they have more time to bounce back. When a person is near retirement age at the time of their divorce, permanent damage has been done. It can be extremely difficult to recoup the lost retirement funds. Older people have a hard time finding work, making rebuilding wealth extremely challenging. Women often find it even harder, since many have stayed home for years taking care of children. Getting back into the workforce at their age is next to impossible.
Even if a person is well-off financially, he or she can still be affected by divorce. Successful people can still distracted by the events of their divorce, as demonstrated in a paper by the Journal of Financial Economics. Hedge fund managers were shown to underperform following a divorce. In the six months following their divorce, they underperformed by 4.3%. They continued to lage by 2.3% for two years following their divorce.
There is no doubt that Amazon founder Jeff Bezos was distracted by his recent divorce. While the 55-year-old did lose billions of dollars in the divorce, he is still the richest man in the world. Still, since his wife, Mackenzie, helped him build Amazon into the company it is today, he was likely distracted from his CEO duties for some time as he and Mackenzie hammered out the details of their divorce.
Divorce impacts health insurance, auto insurance, life insurance, and more. You may not have thought about insurance while married, but now that you are on your own, you need to protect yourself and your assets. Now that you are divorced, you may want to reconsider your insurance needs. If you are renting a place, protect your belongings with renters insurance. To supplement any medical care, consider long-term care or disability policies.
Do not forget about your ex-spouse’s Social Security benefits. Even if you have divorced, you will still have access to his or her benefits, if you meet the requirements. You need to be unmarried, age 62 or older, and your benefit must be less than your spouse’s in order to qualify. You can receive benefits even if your ex-spouse has remarried. However, once you remarry, your benefits will end.
Isolation is a common effect of gray divorce, and men seem to suffer the most. Women are typically the social ones who plan events. Plus, women are typically the caregivers in the relationships, so they are more likely to have a strong bond with their children. Therefore, older divorced men are no longer involved in their wives’ social lives, and their adult children are not as likely to visit them.
These two reasons lead to loneliness, which can have adverse health effects. Isolation leads to chronic health problems, mental health issues, and even premature death.
All this stress over finances can lead to health issues. Many people become depressed over their situation. Many are anxious about what the future holds. These mental health issues develop into physical health issues, such as heart disease and diabetes. Many develop insomnia and a lowered immune system.
Some people develop bad habits, such as substance abuse disorders. Some turn to alcohol or drugs to cope. Some overeat, spend too much money, or recklessly engage in sexual activity with others.
Seek Legal Help
A divorce at any age can be difficult to overcome. As you get older, ending a marriage can have negative effects on your health, finances and more.
Are you prepared for the possibility of a divorce in your 50s, 60s, and beyond? Most likely no, but Palm Beach divorce attorney Scott J. Stadler can help you through the process. He will help you understand your options so you can minimize the damage to your finances. To get started, call (954) 346-6464 and schedule a consultation.