Now that your children are grown and out of the home, you can finally divorce your spouse. You may think that your separation is going to be an easy and cheaper one because you no longer have the welfare of your kids to worry about. But divorcing your partner when you are older in life comes with its own set of challenges that you may not anticipate. Situations where couples over the age of 50 separate are known as gray divorces. Gray divorces are often challenging to deal with because the consequences of any decisions you make can affect you throughout your retirement years.
Learn about the steps you can take to protect yourself financially to minimize the impact of your gray divorce.
Change your living habits
You should keep a careful eye on your money and spending habits. Now that your income is changing, you need to start planning for long-term financial stability. Your divorce may cost more because there are more marital assets at stake now than there were several years or decades ago. There are also health insurance and retirement benefits for you to consider. You should think about your post-divorce finances and make changes and decisions now that will help to keep you financially comfortable afterward.
Consider your tax situation
You should take your tax situation into consideration when negotiating the details of your divorce with your soon-to-be ex-spouse. Some decisions may seem like they are beneficial to your new situation, but they could cause you to end up with more expenses. There are many things you may receive in a divorce settlement that can improve your financial standing, but they may also increase your tax obligations, such as alimony. Alimony received is taxable by the IRS. To avoid tax complications, you should always consider the after-tax value of any assets and monies you are to receive.
Divorces are not always easy and pleasant to go through, especially for older couples. If you are considering divorce or in the process of filing for it, you should speak to an attorney for guidance on the matter.