Divorce at retirement age requires special considerations
Going through a divorce is a difficult journey at any age. For some people, however, it means ending an unhappy chapter of life and starting a happy chapter. This seems to be the case for many Canadians who are hitting retirement age. There has been a spike in divorces for people age 55 and older. These divorces have been dubbed grey divorces.
There seem to be two big causes for divorces at retirement. One is that people find themselves wanting different things for retirement. The other is that they simply don’t love each other anymore. In some cases, the children leaving home make the couple realize that they don’t have much more left in common.
With the rise in grey divorces, it is important to touch on some points that aren’t readily realized about divorcing when you are older. One of these points is that a divorce can cause financial troubles. In some cases, one spouse might have to find life insurance and medical insurance because he or she has been covered by the other spouse’s plan.
Generally, people tend to think that what you had when you got married is yours if you get divorced. That is a huge misconception. Instead, all of the assets you hold, regardless of when they were acquired, are divided during a divorce. Assets such as retirement accounts, vehicles and real property are divided when you divorce.
If you are going through a grey divorce, you should understand how the divorce will affect your retirement. From dividing assets to changing your will, you should have a plan to ensure you are protected during and after the divorce.
Source: FindLaw Canada, “What is ‘grey divorce’?,” accessed June 04, 2015