No matter when a divorce occurs it is financially stressful and taxing. However, when a divorce occurs later in life it can mean a delayed retirement or even just a different type of retirement all together. Parties are generally not able to maintain even the same standard of living they enjoyed during the marriage, given the same fixed income now must be stretched to sustain two separate households.
Although later in life divorces generally do not include children or child support, they usually include dividing retirement savings and trying to support two separate households with this set money.
Ed Ricardo from Jordan Castellon Ricardo recommends, “If you are considering divorce, gather all financial documents, including bank statements: pay stubs; car, boat, and real estate titles; pension and insurance documents; and records of assets and liabilities, including mortgage statements, tax returns, etc. These documents will be used to create a financial affidavit, which is a compilation of your current living expenses. The financial affidavit will include current assets and liabilities. When valuing assets, unless the asset is being divided equally between divorcing spouses, it is imperative that income taxes be considered and that the division of assets reflect the tax burden. The financial affidavit should include your actual income and expenses during the marriage. Track spending carefully; use your checkbook and credit card statements to ensure that you are picking up all expenditures in a realistic manner.”
The Court will then examine each parties financial portfolio, sometimes with the help of a financial expert and determine the need and ability of each party to pay for maintenance. When divorce happens later in life and paying spouse faces imminent retirement, the duration of support and/or the conditions that will trigger termination or automatic reduction become paramount negotiable issues. At this point, instead of income increasing, the chances are that income will be decreasing and parties may be required to split their retirement packages to help support each other.
No matter what age divorce occurs at, it is financially stressful but when you add in the factors of decreased or set earnings makes it a little more complicated.