Quatela Chimeri, PLLC

Gray divorce: can it threaten financial security?

Divorce for couples over the age of 50, also known as gray divorce, is increasing in frequency. As average life expectancies rise, unhappy couples would rather divorce than potentially spend 30 years of retirement together. The Society of Actuaries estimates that approximately 1/3 of men and 1/2 of women will live to the age of 90. Older couples would rather split and spend their golden years happily alone than unhappily together.

While divorce is never easy, gray divorce comes with increased financial concerns. Why is gray divorce a heavier financial burden than divorce between younger couples?

Threatening financial security

Couples involved in a gray divorce are either approaching retirement, or are already in retirement. Therefore, they are nearing the end of their earning potential and question whether their retirement account is robust enough to handle the strain of a divorce.

Younger couples have more working years ahead of them to make up for the financial burden of a divorce, but older couples are nearing the end of steady paychecks, bonuses and promotions.

Gray divorce is especially hard on women

Traditionally, husbands developed their careers while wives supported them by caring for the home. Husbands may hold the financial power in the relationship, and control not only the bulk of the assets, but the knowledge behind shared assets, insurance, investments, etc.

While gray divorce boosts both individuals’ chances of late-life poverty, women face a greater chance than men. Researchers estimate that 27 percent of women that go through a gray divorce live in poverty, while only 10 percent of men end up in poverty.

Protecting your financial future

If you and your spouse are considering divorce, start evaluating your current financial status, and look for ways to protect your financial future. To secure your financial position, consider:

  • Speaking with a financial advisor who can evaluate your investments and suggest areas for improvement.
  • Cutting back on unnecessary expenses. Avoid making large purchases until you get a full picture of your financial status post-divorce.
  • Evaluating your assets. Create a list of your real estate holdings, vehicles, jewelry and other substantial assets. It is important that you have a clear picture of your financial status heading into divorce. This will give you a better idea of what you can expect to fairly receive in the divorce settlement.

Speak with an attorney who understands the divorce process and can fight for your interests. While you may never have gone through a divorce, an attorney will be able to walk with you each step of the way and create a strategy for your future.

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