In Connecticut, older people are divorcing at increasingly higher rates. According to Pew Research, the divorce rate for people older than 50 has doubled in the last couple of decades. When older people divorce, they are left with added concerns because of the limited time that they will have before retirement. If they do not plan well, they may be forced to remain in the workforce for much longer.
When people get divorced while they are young, they may be able to bounce back financially in a quicker manner. By contrast, older adults who divorce may have a more difficult time recovering from a divorce. People who divorce after 50 may have already reached their maximum earnings potential, and they also will have less time to save for their retirement.
Older adults may also spend a substantial amount on legal fees, which can cut into their assets. People who bitterly litigate divorce issues may pay higher costs, and they may also suffer negative tax consequences if they divide their retirement accounts and investment accounts improperly. This can expose them to early withdrawal penalties, taxes on the withdrawals and capital gains taxes on divided investments. Some people may also be attached to the family home but not be able to truly afford its upkeep, mortgage payments and property taxes. If they insist on taking the house, they may be placed in more difficult financial situations.
People who are older than 50 and who want to get divorced might want to talk to family law attorneys. Lawyers may help their clients to view their finances from a logical perspective. They might also be able to explain the potential tax issues that might arise from taking different assets. Attorneys may work to negotiate full property settlements for their clients instead of engaging in protracted divorce litigation.