Divorce is difficult at any point in life, but it can be particularly challenging at certain ages. Those who are close to or past the age of retirement are financially vulnerable. They live on a fixed income and have limited earning potential. They may already have major medical expenses or might need intensive medical support in the next few years.
Divorcing at such a time can worsen the financial challenges that people face. A gray divorce occurs when those in their 50s or beyond decide to end a marriage. Those considering gray divorce are often very anxious, especially if they have made economic sacrifices for the family. Dependent or lower-earning spouses may not have pensions or retirement savings of their own.
How can they afford their cost-of-living expenses after a gray divorce?
With a share of their marital estate
Michigan law protects the rights of both spouses in a divorce scenario. If spouses litigate their property division issues, a judge should try to divide their property in an equitable manner. A dependent spouse may have a right to a share of retirement savings or a pension accrued by the other spouse. They should receive a fair share of home equity and other valuable assets. Those resources can provide the foundation for financial independence after divorce.
With spousal support
The family courts in Michigan can order a higher-earning spouse to provide alimony or spousal support to their lower-earning spouse. Particularly in scenarios where one spouse might receive a pension that is not directly divisible, regular payments can help balance the economic circumstances of the spouses.
With common benefits
Dependent spouses may only be eligible for Medicare benefits because of the employment history of the other spouse. The same could be true of Social Security retirement benefits. Thankfully, both programs have rules in place to protect dependent spouses after a divorce. Provided that the marriage lasted for at least 10 years, a lower-earning spouse might be able to secure Medicare benefits or Social Security retirement benefits based on the employment history of the wage-earning spouse. Typically, the claims of a dependent spouse do not diminish the benefit rights of the higher-earning spouse.
Those preparing for a gray divorce often need help strategizing to ensure their financial stability during their golden years. Reviewing household finances with a skilled legal team can be an important step for those trying to prepare for an upcoming gray divorce.