Couples who get divorced after the age of 50 tend to have more complicated divorce proceedings. This is because they have likely accumulated a wide variety of valuable assets including retirement accounts, real estate and other property. Since couples in this age category are also nearing the age of retirement or are already retired, they may have additional concerns regarding their future financial security and how the divorce could affect the ability to retire.
If you're about to move forward with a divorce after 50, here are three things you may want to keep in mind:
Create a detailed inventory of all your assets: It's not uncommon for one partner in a marriage to have a better knowledge of family finances. For the spouse who is not "in the know," it's important for this spouse to get him- or herself up to financial speed as quickly as possible with regard to retirement accounts, brokerage accounts, IRAs, 401(k)s, real estate assets and more. This will ensure that the spouse can protect his or her marital property rights and has a better chance of maintaining trust and transparency throughout the asset division process.
Consider the financial responsibility associated with keeping your home: Before an over-50 spouse decides to keep the family home in a divorce, it's important to evaluate whether the plan is affordable. Maintaining a large home on a single income could prove to be an unsupportable expense for a spouse who is accustomed to splitting these costs with another contributor to family income.
Examine tax liabilities associated with your assets: A family home worth $300,000 and a vacation home worth $300,000 might have the same value on the real estate market, but what if you originally purchased the vacation home for $400,000 and you purchased the family home for $200,000. The family home will have considerable capital gains tax liabilities associated with it upon its sale, whereas the vacation property will not have any capital gains. It's vital to consider the tax consequences carried by property during the asset division process to ensure that the way you split your marital estate is fair to both sides.
Couples with large marital estates who are divorcing after the age of 50 will have numerous considerations that are unique to their age group. It's important that spouses and their divorce counsel study how these concerns could apply to their particular divorce cases before moving forward with the process of dissolving a marriage.