When divorce happens to people in Ohio who are 50 years or older, untangling the financial lives of the two people involved can be challenging. After all, many couples 50 years and older that have never previously been divorced have years of managing finances together, retirement accounts that have accumulated over time and sometimes pensions, among other assets. Usually each person involved in the divorce has to make some changes when it comes to managing their finances, particularly when spousal support payments are required.
A certified financial planner from Minnesota recently discussed the phenomenon of late divorce and how it can impact a person financially. He suggests that it is natural to focus on retirement after couples divorce. Planning financially for the future may have been something a person and his former spouse did together. He suggests that divorce, however, may require each person to redefine their long-term and short-term goals.
Making a fresh financial start may require people to consider financial decisions that would impact cash in the here and now versus asset divisions with long-term consequences, like pensions. The financial planner recommends rather than going after cash alone, people should also consider assets that might continue to provide income, grow in the future and possess tax advantages. Once the asset division has been agreed upon, it is suggested that income and planning for expenses like alimony payments and taxes should become the focus.
Retirement planning after a late divorce often requires a different approach than going about it as a married couple. It often involves reevaluating a person’s financial position including expenses, income produced, how taxes might change, and a myriad of other considerations. When facing these and other divorce related concerns, it might be helpful to seek guidance from an experienced attorney.
Source: Forbes, “Saving your retirement from a divorce,” Greg Brown, Oct. 21, 2013