Divorce Over 55
If you’re divorcing after the age of 55 after having been married for many years, you may be wondering how you will rebuild a new life, redefine yourself, and find new love. It is a time when you are feeling the possibilities and yet the anxiety of the unknown. Karen Ann Ulmer, P.C., can help you get on a solid legal and financial footing so that you can explore and build your new life with confidence in Bucks County.
Spousal support
During your divorce litigation and negotiations, certain factors will affect the final settlement or judgment regarding support payments. They include the length of the marriage, age of the spouses, health conditions, and earning capacity. Most states, including PA and NJ, are equitable distribution states; marital property is divided in what the court considers a fair manner, which is not necessarily 50/50.
For example, if a wife stayed home to raise the children while the husband built a lucrative career, her earning capacity is probably quite low, and therefore she will likely be awarded spousal support that is sufficient to maintain her standard of living.
Dividing retirement funds
Most older couples have retirement plans that they have invested in over the years, such as IRAs, 401(k)s, and pensions. The court generally divides these between the spouses in an equitable manner. However, only contributions and earnings that took place during the marriage are divided — if a spouse contributed to an investment fund prior to marriage, that portion and its earnings are not considered in the calculation.
At Karen Ann Ulmer, P.C., we have financial experts who can accurately calculate the marital assets in any retirement account or other investment account so that our team of attorneys can determine a fair and adequate financial division demand. It is critical for the divorce ruling or negotiated settlement to stipulate the division of these funds; a divorced spouse cannot later petition the court for division of an asset, unless that asset was hidden during the divorce litigation.
Division of pensions, including 401(k)s, must be negotiated during the divorce, though distribution would generally not take place until the time of retirement. A court order called a Qualified Domestic Relations Order (QDRO) must be sent to the retirement plan administrator to make the necessary adjustments. If the person is already retired, a lump sum can be transferred to the other spouse’s IRA or other retirement fund.
Social Security is governed by federal law and is not divided upon divorce. A divorced spouse may claim benefits from the ex-spouse if:
- You were married for at least 10 years
- You are 62 or older
- You have not remarried
- You receive smaller Social Security benefits from your own work history than you would receive based on your ex-spouse’s work history
Other financial considerations
Divorcing when you are older can have other financial considerations that need to be included in any divorce settlement. These include the care of any minor children still at home; the children’s education; other financial needs of the children that parents would normally cover, such as purchasing an automobile; and health insurance for yourself and any children still at home.
You should also consider taking out life insurance policies for yourself and your ex-spouse if you will be receiving spousal or child support.
The court will look at each spouse’s ability to work and earning capacity before making a final decision regarding spousal and child support. The court may require a low-earning spouse to pursue technical or educational training to prepare for a return to the workforce or for an increase in earning capacity. This will impact the amount of spousal support or the length of time spousal support would be needed.
Estate Planning
Since you have been married for a while, you may have already created a will and medical end-of-life plan. You may have chosen financial and medical powers of attorney. You will have established the beneficiaries of your investment accounts. All of these must be reviewed immediately and changed as needed. Your ex-spouse’s name will have to be removed from deeds and loans. Shared bank accounts and other accounts, such as social media accounts, should be closed, and individual accounts should be opened.
At Karen Ann Ulmer, P.C., we walk our clients through all these detailed financial considerations to help them start their new life on a strong financial footing. Request a confidential consultation today by calling (866) 349-4721 so we can get started right away.
