Gray divorce is on the rise, and couples parting ways at this stage of life should know there are important financial and estate planning issues to consider.<\/p>\n
In the last five years, more long-term marriages have ended than ever before. It\u2019s a global phenomenon. Most divorces still happen to couples in their 30s and 40s, but more couples in their 50s and 60s \u2013 who have been married 25 years or more \u2013 are deciding to split up.<\/p>\n
Their concerns are different than younger couples who divorce. In a more typical divorce, partners are concerned with young kids \u2013 assuming there are any \u2013 being alright. In gray divorce, partners have accumulated substantial assets, so there\u2019s more to be divided. There are older kids, possibly grandchildren. There are more stakeholders.<\/p>\n
Sometimes, it\u2019s becoming an empty nester that\u2019s the impetus for the split. The kids are 18 or over and gone. And the couple finds they\u2019ve grown apart. Sometimes it\u2019s the children who \u2013 maybe even unwittingly \u2013 have kept their parents together.<\/p>\n
No matter what age the kids or grandchildren are, they still need to be taken into consideration.<\/p>\n
In gray divorces, there can be a lot of intertwined interests that need to be unraveled and divided, such as vacation homes, rental properties, a family business, etc. For anyone considering getting out of a long-term marriage, here are a few things to keep in mind.<\/p>\n
Divide and conquer<\/strong><\/p>\n Have you and your soon-to-be-ex shared the same financial advisor, estate planning attorney, or accountant? Probably. Now, you each must have your own set of advisors. It\u2019s cleaner and easier for one spouse to stick with the existing advisors \u2013 and for one spouse to get new ones. Plus, ethically speaking an advisor can\u2019t serve each of you.<\/p>\n Consolidate and conquer<\/strong><\/p>\n If the couple is retired, they have likely already consolidated their nest egg, which makes divorce and splitting up assets easier. If they haven\u2019t done this yet, doing so will again make it easier. If the couple hasn\u2019t done that yet, it can be part of the negotiations.<\/p>\n Family affairs<\/strong><\/p>\n Who will pay for the wedding(s) of your child or children? That\u2019s often part of divorce negotiations. It\u2019s cleaner to get this settled at the time of uncoupling, rather than waiting much later.<\/p>\n Also, any previous estate planning documents that left everything to the surviving spouse may need to be updated with a new beneficiary or beneficiaries. If I\u2019m the adult child of divorcing parents, it\u2019s clear to me that whatever my inheritance originally was going to be, it may now be diluted.<\/p>\n