The burgeoning baby boomer population in the U.S. has created an environment where the divorce rate has accelerated for people over the age of 50, and has significantly impacted how the over 50 crowd deals with issues of retirement and support.
A late-in-life divorce puts divorcing couples in the unenviable position of having to divide a marital estate often accumulated over the course of a long-term marriage, at a time when earning capacity – in both amount and duration – has reached its plateau or may be receding. A couple’s nest egg will then have to fund two separate households with resources that they long-planned to use to fund only one. The problem is particularly acute for marriages where the accumulation of assets has been limited. In any case, each of the divorcing parties will face the prospect of financial stress, whether caused by having to delay retirement decisions in order to build more in the way of retirement assets, or by having to continue to work to fund a support obligation for a less marketable (or non-working) spouse.
The means by which parties try to maintain a lifestyle acquired over 25+ years of marriage – while realizing that working until 70 or 75 is neither desirable nor usually realistic – is extremely challenging. The ramped-up cost of health care after a gray divorce is another complicating factor. A less advantaged or often unemployable spouse can be understandably terrified of what the future holds, and there are no easy fixes.