Obtaining a divorce can result in significant financial impact to people of all ages, but for people in or approaching retirement, the effects may be even more considerable. There are many issues to decide in the event of a divorce, but for older people, property division may be the most important.
Statistics suggest that the divorce rate for people age 55 and older is increasing, and residents of Gwinnett County may face similar issues. Divorce amongst people approaching retirement age has become more common and the rate is only expected to increase.
Although there are many reasons older people decide to end their marriages, they may not realize how costly the decision is financially. Divorce typically results in both parties having reduced assets, and the older a person is when they get divorced, the less time to have to rebuild those assets. Additionally, seniors on a fixed income may have little opportunity for increasing their economic standing.
Most states, including Georgia, have rules stating that marital property must be divided equitably. Equitable division means what is fair and reasonable under the circumstances; it doesn't necessarily mean that the division must be exactly equal. In making this determination, a court must determine how property is classified. If one of the parties brings an asset into the marriage or acquires it through gift or inheritance, it is considered separate property and will remain with that party. All other property that is accumulated during the marriage is considered community property that is subject to equitable distribution.
Community property can include retirement accounts, pensions and real estate. The distribution of these assets amongst older divorcing couples can have a more significant impact than it would on younger people who are less reliant on them.
There are many legitimate reasons for people to seek a divorce from their partners, but the significant financial impact may be overwhelming as people get older. It is important for both parties to know their property and what they may be entitled to so that an equitable outcome can be obtained and both parties can make their financial ends meet.
Source: The Vancouver Sun, "Aging Canadians confront cruel financial reality of 'grey divorce'," Lindas Nguyen, Sept. 19, 2012
To learn more about this issue, please visit our property division page.