“Will you still feed me; will you still need me when I’m sixty-four?”
The Beatles tune “When I’m sixty-four,” recorded in 1966, foreshadowed a growing trend of marital instability among Baby Boomers in the United States.
Wikipedia defines “gray divorce” as the demographic trend of an increasing divorce rate for older couples in long-lasting marriages”. Gray divorce is on the rise. Among United States adults 50 and older, the divorce rate has nearly doubled, according to a 2015 Pew Research Center report. Furthermore, the research shows that the divorce rate for adults age 50 and over in remarriages is double the rate of adults 50 and over who have only been married once. The climbing divorce rate for adults ages 50 and older is linked in part to the aging Baby Boomers, who now make up the bulk of this age group (age 51- 69). The research indicates that many individuals in long term marriages have become unsatisfied with their marriages over the years, and seek opportunities to pursue their own interests and independence for the next chapter of their lives.
Financial Effects of Gray Divorce
Although gray divorce can have positive effects, such as control of finances and independence, separation and divorce on the brink of retirement can be financially and emotionally devastating. Older divorced adults feel less financially secure than older married or widowed adults, particularly among women. A significant amount of married women leave financial decisions to their spouse. They may not have participated in long term financial planning, know the fixed monthly expenses associated with running the household, or the extent of marital assets and liabilities.
Lifetime or long-term alimony is no longer guaranteed in Pennsylvania. The financially dependent spouse may find it difficult to sell the marital residence and adjust to a change in lifestyle during the next stage of life. The higher-earning spouse is faced with the realization that there may not be enough years to recover funds which will be transferred to the financially dependent spouse. Even if both parties have worked, there is usually an imbalance of assets among them. Women, in particular, have taken time off from careers to raise a family, which has resulted in reduced retirement assets and social security income. If the marriage lasts under 10 years, the dependent spouse may not be entitled to up to one-half social security benefits of the other spouse.
Older people may have limited or no job security, and have serious concerns about reentering the work force. It is extremely difficult to go back to school or change careers over the age of 50. Self-employed or small business owners may not have sufficient money saved for retirement, or may receive minimal social security benefits if they have not contributed as much as a salaried employee.
The empty nester couple may have just finished putting children through college, and recently depleted retirement assets to avoid co-signing student loans. They may also be faced with providing economic support to aging parents or adult children with special needs. Gray divorce will have a serious impact on their long term plans for retirement.
Finances are even more complex when splitting up a household for the second or third time around. There may be more than one set of children competing for financial resources. A higher earning spouse in a second marriage may have to postpone retirement to meet support obligations for unemancipated children.
Long term care is an issue because people are living longer. If a spouse or children are not available to provide direct care or support for long term services, the cost of long term care insurance should be considered when budgeting for retirement.
Health Risks from Gray Divorce
In addition to the financial consequences of gray divorce, there are significant health concerns, including interruption of health insurance coverage, loneliness and social isolation, depression, chronic illness, and in some cases, mental or physical incapacity.
It is extremely important for older individuals experiencing separation and divorce to consult with a financial advisor to create a financial plan for retirement, and with an attorney about executing a new Will, Power of Attorney and Medical Directive.
In light of the significant financial and mental health concerns associated with gray divorce, parties should be encouraged to resolve their disputes amicably, whether through mediation or the collaborative process. Additionally, collaborated and mediated divorces are more likely to reduce the stress associated with divorce, and provide for a more open and healthy process between the spouses.
About the Author
Rochelle Bobman, Esq. is a member of Bort Law where her practice is focused on divorce and family related matters, elder law and consumer law. Ms. Bobman is trained in both mediation and collaborative law, and is a member of the Collaborative Law Professionals of Southeastern Pennsylvania and the Collaborative Law and Mediation Committees of the Montgomery Bar Association. She is a court-appointed Mediator in the Court of Common Pleas of Montgomery and Chester Counties and serves as Master in the Mortgage Foreclosure Diversion Program. Click here to learn more about Rochelle Bobman, Esq.