The first years of my business saw very few dissolutions of long terms marriages (over 10 years in length). I had a few couples who quietly dissolved their marriages for no other reason than an illness was bankrupting them and they couldn’t afford the costs of their health care. A divorce would allow the sick spouse to qualify for Medi-Cal and get the treatment they needed without total financial ruin. These people were ashamed and had no plans of telling their children what they were doing. In their hearts, they were still married.
About 10 years ago, I began to see more couples divorcing after 20 years of marriage. It was shocking. I thought if they could stay together for that long, why couldn’t they figure a way to keep their vows until “death do you part”. Most of the people I was accustomed to dealing with were married for a short time, In my mind, they got married too young, too soon, to the wrong person, without any idea of what they were doing (think Britney Spears). They were still at an age that they could start over, older and wiser to make the right decisions after learning from their past mistakes. But I didn’t understand the people coming in at a higher frequency, married for 20 years, 25 years, 30 years and more who weren’t divorcing for the reasons I stated above.
Today, the divorce rate of people over age 50 has more than doubled since 1990 and since 2008 more than 25% of the people who divorce in this country are over the age of 50 (think Al & Tipper Gore). It’s called the Grey Divorce and it brings with it a whole new set of complex issues. Don’t be fooled into thinking that just because the kids are grown and gone, and child support is no longer an issue, that there are less legalities to manage.
Dividing pensions, dividing real estate, estate planning, will re-writing, dissolving trusts or jointly held corporations, dealing with social security benefit issues, declining health, declining income, the availability and cost of health care, re-entering the job market, tax issues, retirement, spousal support and survivors benefits, will affect negotiating a marital settlement differently than in a short term marriage of a younger couple. In a grey divorce, there is much more emphasis on preserving assets as there is less time to recover financially.
For example, a younger person usually views the family home as a place to maintain a sense of stability for the children, which has a financial value, if not now, but later. An older person might view it as a source of income via reverse mortgage, which could affect considerations regarding spousal support. Keeping the home could also benefit them with age-related property tax exemptions. Or they might see it as a liability from the maintenance standpoint. As you can see, an equal division of benefits through property buyouts and other considerations can be mind boggling. The need for professional advice will be more important to reach a fair settlement.
Collaboration with a legal document assistant, financial adviser, private mediator and an attorney is preferable to litigation and even more important in a grey divorce as the stakes are much higher.
