A Connecticut divorce has significant financial repercussions, especially later in life. As couples in their golden years decide to part ways, they must grapple with a unique set of financial challenges and considerations that can impact their retirement plans and overall financial security.
While divorce is often emotionally challenging, addressing the financial aspects with diligence and planning can help ease the transition and pave the way for a more secure financial future.
Division of assets
Throughout a marriage, couples accumulate joint assets, such as homes, investments and retirement accounts. Dividing these assets can be complex and may result in the need to sell or split them, affecting both spouses’ financial stability.
Alimony and support
In some cases, one spouse may decide to seek alimony in a divorce. This financial arrangement seeks to provide financial assistance to the lower-earning spouse. The amount and duration of alimony can significantly impact both parties’ finances.
Divorcing later in life can also jeopardize retirement plans. The division of retirement savings can reduce the nest egg that both spouses were counting on for their retirement years.
Social Security benefits
Another important financial consideration is the impact of a divorce on Social Security benefits. Married couples can often claim higher benefits through spousal or survivor benefits. After a divorce, eligibility for these benefits may change, potentially reducing overall income during retirement.
Health care costs
Health care expenses tend to increase with age, making access to affordable health insurance increasingly important. If one spouse’s employer-sponsored health insurance plan covers the other spouse, divorce may lead to a loss of coverage for that party.
AARP reports that older adults are divorcing more and more often, with the divorce rate among those 65 and over tripling between 1990 and 2021. As a result, the number of divorcing individuals needing help navigating the various financial aspects of a split continues to climb.