In recent years, gray divorce has become a more commonplace term. With the increased prevalence of divorce filings for older adults, new concerns come to light. Gray divorces have financial considerations that do not typically apply to other divorce situations.
There are a few important elements to consider in a gray divorce settlement.
Are you supporting an adult child?
Whether you are carrying student loan debt for a child who recently graduated or supporting an adult child through a financial transition, the effects on your finances are unlike any other type of divorce. Make sure that the liability is properly allocated in the settlement agreement.
Are you on Social Security?
If either of you retired, collecting Social Security reduces your available income and earning potential. The judge will consider this as part of the determination of spousal support and asset distribution. In addition, since most gray divorces are long-term marriage dissolutions, that often means that both parties retain eligibility to claim Social Security benefits under the former spouse’s account.
Are your retirement accounts clearly divided?
Retirement accounts are a standard part of a gray divorce. Make sure each party’s retirement accounts are equitably and fairly distributed. The judge will consider the duration of the marriage, the time period of the fund investment and the amount drawn out of the fund so far as they determine the proper distribution.
Gray divorces come with financial considerations that often do not apply to other cases. Consider these elements as you prepare to file your divorce case.