Financial tips for older adults going through a divorce

On Behalf of | Jun 2, 2020 | Divorce |

Older adults in Michigan who are going through a divorce may have accumulated more assets and have more complex financial situations than their younger counterparts. In addition, they may be retired or near retirement, and this leaves them less able to recover financially from a divorce. With this in mind, there are steps they can take to cushion the financial blow.

First, people should inventory all shared assets and debts and collect all relevant financial documents. There may be jewelry and other assets that need to be appraised. They should note how property is titled. Inheritances and other separate property may not be considered as part of the divorce settlement. In a high-conflict divorce, there may be concerns about a spouse hiding assets.

Next, people should ask themselves a few questions to help determine what kind of a settlement will be necessary. For example, they should consider how the divorce will change their lifestyle, how it will change their retirement plans and what kind of assistance children or grandchildren may need. When the divorce is final, there are a few financial ends that need tying up. This might include retitling any assets that need it, arranging for a new health insurance policy if necessary and updating the estate plan.

There are a few potential financial pitfalls individuals may want to keep in mind during negotiations over property division. It is important to account for any taxes associated with withdrawals from a retirement account when assessing their value. If one person is keeping the family home, that person should make sure that if the mortgage is not paid off, they can continue to afford it along with other costs, including insurance, taxes and upkeep. The couple may want to sell the home instead and each move to smaller residences.

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