New Jersey residents may be interested in learning about the effect that ‘gray divorces”, which involve spouses over age 50, have had on society over the past few years. In 1990, only 10% of the divorces involved individuals over the age of 50. In 2010, that number had jumped to 25%.
Most people who have gone through a divorce realize that marital separation brings many financial challenges. When a person divorces later in life, those challenges have the potential to become even greater. The average individual over 50 can expect their personal income to decrease by up to 50% after a divorce. Women are disproportionately affected by this trend. Women over the age of 50 who divorce can expect their wealth to decrease by nine times more than women who stay married.
The financial effects of a gray divorce are more pronounced because of the time factor involved. When a younger couple gets divorced, both individuals have time to financially recoup from any financial setback divorce creates. However, when a person gets divorced later in life, they simply do not have the time to rebuild their 401(k) or any other investments that they built up over the years.
The financial impact of getting divorced over 50 could be also be felt by the couple’s children, who may be in college, as well as grandchildren. Furthermore, it puts a huge impact on social services that are now required to absorb the financial challenges these older individuals face.
An individual over the age of 50 facing a divorce may want to speak to a family law attorney. Legal counsel could serve as an advocate for their client, explaining topics like shared accounts, asset valuation, property division laws and other practical financial issues that could arise during the divorce process.