The end of a lengthy marriage can cause a great deal of emotional pain. Unfortunately, it may also have a significant financial impact on older individuals who are close to retirement or who may already be retired. If you are going through a gray divorce, it is important that you have a plan to handle the financial fallout that it may cause.
Know what you have
As soon as you know that your marriage is coming to an end, you should start learning as much as you can about your current financial situation. This can be done by reviewing tax returns, bank statements and credit card statements. Tax returns and other financial statements may contain clues that your spouse is hiding assets or has assets that he or she never bothered to tell you about. If you do discover items such as a hidden bank account or second home, these assets should be divided in an equitable fashion in a final settlement.
Think about what you’ll need after the divorce
In many cases, retirement accounts are divided between spouses when a couple gets divorced. This means that you’ll likely have a smaller nest egg to rely on after your marriage comes to an end. Therefore, you may need to go back to work in an effort to replenish your retirement savings and to ensure that you have an adequate emergency fund.
Ideally, your emergency fund will have enough money to pay bills and other expenses for up to a year. It may be in your best interest to put even more money into a savings account if you are supporting an adult child or a grandchild. This may help to ensure that there is money to cover mortgage payments or pay their college tuition.
While a divorce may result in a loss of assets, there are ways to remain financially stable after a marriage ends. An attorney may help you negotiate a settlement that includes alimony payments or other resources to help you live comfortably on your own.