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For Baby Boomers, divorce is booming, too

This is the third in a series of articles looking at how the aging of America’s population is affecting the practice of law.

Divorce rates in the United States have been on a steady decline for decades, but one group of Americans is heading decidedly in the opposite direction.

A report published by the Pew Research Center in 2017 found that divorce rates for Americans over 50 had doubled since the early 1990s, and rates for those over 65 had tripled. The study attributed part of the increase to the aging of the country’s population, and part to higher rates of remarriage.

“Their marital instability earlier in life is contributing to the rising divorce rate among adults ages 50 and older today since remarriages tend to be less stable than first marriages,” the report’s author, Renee Stepler, wrote. That age group now accounts for about a fifth of all divorces in the U.S.

The rise of gray divorce could also have something to do with longer life expectancies and greater financial independence resulting from a higher percentage of families depending on both parents to provide financially, Penelope Hefner of Sonoma Law in Charlotte said.

Attorneys said that the longer the marriage has been together, the more difficult it can be to disentangle assets. These factors are further compounded if the late-in-life divorce isn’t the client’s first. Hefner said clients should consider how the divorce will impact estates for existing children and also previous spouses.

“Clients should be thinking about the impact of divorce on children from prior relationships,” Hefner said. “Some problems associated with ‘gray divorce’ are confusion as to beneficiaries, more complicated marital estates, and potentially more than one support obligation going on at the same time.”

While it’s not always the case that one spouse serves the role of breadwinner while the other takes care of the home, Hefner said these are important factors to consider when establishing alimony.

“Financially dependent spouses will be more desperate for support, given the unlikelihood of them starting a career late in life, and financially supporting spouses may be worried about their ability to keep up support payments as they slow down or retire.”

If the clients are retired at the time of the marriage, it’s worth considering whether a divorce is even feasible financially, Barbara Morgenstern of Morgenstern & Associates in Greensboro said.

“If the parties are retired, they need to figure out whether they can afford to separate and support two households,” Morgenstern said.

Morgenstern added that it’s important to note that the lower wage earner is only entitled to the greater of his or her own benefits or to half of the higher wage earner’s Social Security.

If the client isn’t already retired when the divorce occurs, Hefner said they should understand that as they get older, they have less opportunity to make up for “losses they may face pursuant to a divorce.”

Attorneys agreed it’s important to lobby for an equitable division of assets. One tool used to help with this equitable distribution is a qualified domestic relations order.

“Attorneys use QDROs to make sure there are not tax consequences when dividing retirement,” Gregory Forman, a family law attorney in Charleston, South Carolina, said. The idea is to not waste money on penalties or taxes by taking retirement funds out of an account prematurely to divide it for the divorce.

Morgenstern said it’s important, when representing the lesser employed spouse, to draw and qualify a QDRO quickly in order to lessen the chances of foul play by the other spouse.

“QDROs need to be drawn and qualified quickly so the non-employee spouse can start receiving benefits as soon as possible and not rely on the employee to do the right thing and divide his or her retirement,” she said.

While custody of children is more often than not an issue in gray divorce cases, Hefner said it’s still important to take care, prior to and during a divorce, to protect adult children from the fallout.

“Adult children often get dragged in and that can hurt the family unit, even if not dealing with minors,” Hefner said. She suggested utilizing prenuptial agreements prior to a remarriage and postnuptial agreements during a divorce, along with an updated estate plan, to help clients make their expectations for the future clear to everyone involved.

Morgenstern suggested attorneys point clients toward a good financial planner to help them manage their money and budget their more limited post-divorce finances.

Another concern for clients involved in late-in-life divorces, especially when one is unemployed, is the matter of health care.

“If there are serious health issues … they may impact the spouse’s quality of life without the medical and other care previously provided by the other spouse,” Morgenstern said.

While getting divorced is rarely pretty, it can be especially difficult for people who have known one another intimately for decades, and money is just one of many factors that can lead to emotionally charged actions and reactions. Attorneys said it’s important to be patient and have empathy for one’s clients.

Forman said it’s helpful to note that for many, gray divorce isn’t about a failure, but a new beginning.

“Some people are unrealistic about what a marriage entails, but sometimes, it’s because you’ve realized that the relationship has run its course,” Forman said. “What you need for the last 20 years of life may be something different, or you may realize it’s not working and you want something better. I see it as an optimistic act when done intelligently.”

Follow Matt Chaney on Twitter @NCLWChaney

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