Whenever married individuals divorce, their estate plans likely need some updating. When it comes to “gray divorce”, there is a definite need-to-change. Americans over 50 are getting divorced at a record rate, ICLEF notes in its “Law Tips” website. The special challenge for Indiana estate planning attorneys lies in the fact that in a “gray divorce”, each spouse is likely to leave the marriage with more assets than couples who divorce at a younger age.
Issues typical in gray divorces include:
- The parties have little or few remaining years of earning potential.
- The financial planning done for retirement is often jeopardized (two living separately definitely cannot live as cheaply as one).
- When either the husband or wife has not yet retired and has a defined benefit pension plan, those assets require professional valuation.
- The marital residence may be too expensive for either member of the couple to maintain.
- Healthcare issues may complicate the divorce, particularly when one spouse had been relying on the other’s employer plan.
Steve Harnett of the American Academy of Estate Planning Attorneys remarks that “It is no longer widowhood that dominates the landscape, as it once did. These days, it is more likely than not that a single senior is a product of divorce.” Besides a reduced income, there are other issues that a newly-divorced senior would need to address, Harnett points out, including:
- revising their estate plan
- examining beneficiary designations
- revisiting health care directives
“Divorce is a life-changing event. Sometimes it is a good thing and sometimes it isn’t,” writes Christopher Yugo in the New York Times. In either case, it’s important to have a plan that addresses the change in your life. At Rebecca W. Geyer & Associates, our attorneys know that in “gray divorce” situations, a plan for each of the parties can make all the difference in their respective situations going forward.