Dividing up assets is a central question in almost any divorce, but if you decide to end your marriage while you are nearing retirement age, you might find that splitting up your assets is especially concerning to you. Because of where you are in life, holding on to as much of your assets as possible may take on greater importance.
As Forbes explains, splitting up assets in a gray divorce presents special concerns. Older couples tend to accumulate a lot of assets, which makes dividing them up a more complex affair. In addition, it can matter a lot to your future livelihood how much of your assets you end up with if you divorce while you are older.
The problem of earning potential
If you were to divorce in your twenties or thirties, you would likely have a lot of earning potential ahead of you. You could still spend years working at a job and putting away income in a retirement pension or a savings account so by the time you retire, you will have established a comfortable financial position.
But if you retire in your fifties or sixties, you may have little earning potential left, if any at all. You may have decided to retire already. As a result, you may not be able to make up with new income whatever you lose in your divorce. This can intensify battles over assets as you seek to hold on to as much as possible.
Handling asset division in gray divorce
Older spouses may still navigate asset division without ending up in a bad financial place. For one thing, the problem of earning potential does not affect all older couples. Also, if you have stayed married for a long time, you may have accumulated a lot of assets over the years. So even if you lose some of them to your spouse, you might have more left over than if you had divorced at a younger age.
In addition, older couples who split up generally have children who have already grown up. So child support is less likely to be a factor if you divorce around retirement age. And just as older people can divorce, they may also remarry. If your spouse should marry someone after your divorce, it could mean the end of your spousal support obligations.