What does it take to recover from a divorce? From an emotional perspective, it may take years. The same can be true for the financial impact of a divorce. But, what if you are already approaching your senior years? What might the impact of a so-called gray divorce be on your retirement plans?
A recent news article posited that a divorce that occurs later in life may actually upend all of the plans you have carefully plotted out for your retirement years, due to the financial impact. So, what can you do to prepare if a gray divorce is in your immediate future? The recent article suggested a few tips to consider.
First, for spouses who haven’t been all that involved in financial planning for retirement, prepare for the divorce by getting familiar with the state of your finances. That means looking at credit reports, tax returns and investment or retirement account statements, at minimum. Next, think of the asset that is usually the most valuable for married couples: the house. Who will keep it? Should either one of you keep it as retirement approaches?
The ramifications of decisions regarding the family home can be some of the most consequential in terms of finances and retirement plans. Lastly, consider how your joint debt obligations will be handled. Since Michigan is an equitable distribution state, debt obligations may not always be split up in a 50/50 fashion.
Thinking short- and long-term
Preparing for a divorce at any age is a challenge. But, it can be more challenging for older Michigan residents. Be sure to think of the financial and emotional impacts both in the short-term and long-term. If you have questions or need assistance in an upcoming divorce, do not hesitate to contact our office for a free consultation.