The Silver Lining in a Silver Divorce
According to the Hartford Courant and the New York Times there is a growing trend over the last decade or two in “Silver” divorces, that is the divorce of people in their later years. In an age when there is no longer a stigma involved from divorce and people are living longer, many people are finding that they are less satisfied in their marriages. As a result, they have become more proactive in addressing their marital dissatisfaction. While it’s perfectly fine to pursue a divorce to hopefully achieve for more happiness and satisfaction, someone considering this course of action needs to understand the legal and financial consequences of the decision to divorce. While it would appear to be a simple affair, especially if there are no child custody issues, there are still many questions and issues involving finances, independence and happiness.
Usually, a Silver divorce involves people who have been married for several decades. Though the likelihood of custody issues are close to none, financial issues can be more complex and burdensome in a Silver divorce. Without a sound prenuptial agreement, which is uncommon in Silver divorce, all assets, including retirement plans and pensions, are viewed as marital property.
A number of factors will determine if and how these marital assets are divided upon divorce. Connecticut is an equitable distribution property state, which means that all assets from day 1 of the marriage to the date of divorce will be looked at as assets of the marriage and will be distributed “fairly”, but not necessarily equally. Assets from the marriage will be divided and it is important to consult with an attorney to understand how that may play out and to protect each spouse’s rights and share of the assets.
For full time stay at home spouses who may have raised children for the past decades, the good news is that alimony is likely. There was a time when alimony for life was awarded depending on the circumstances in Connecticut and other states. That has become less common? with many judges. Additionally, Connecticut law [now] makes it more difficult to secure alimony for life. If it is awarded, one issue to consider is whether or not it is backed by a life insurance policy. In older divorces, the likelihood of a spouse dying during the alimony period is higher and there is a greater need to protect its continuation in the event of the alimony-providing spouse passing away.
Another challenge is health insurance. Health insurance, as well as other insurance provided by one spouse, can no longer be provided in the same fashion once the divorce is finalized. COBRA will allow one spouse to stay on another’s policy, but only for a limited time. It is likely in a Silver divorce that the cost of such insurance is much higher than with younger folks divorcing after shorter marriages. Coverage for the spouse who wasn’t the primary insured member should be part of any divorce discussion to avoid any unpleasant and problematic surprises.
Social security is another consideration in any divorce, but especially in Silver divorce. A stay at home spouse, or even any spouse who is the lower financial earner, is entitled to social security retirement benefits of the other spouse, assuming the marriage lasted at least ten years.
In a Silver divorce other experts such as tax advisers and appraisers may be helpful in evaluating the marital estate and understanding the tax consequences of the divorce, including but not limited to how taxes pertain to alimony and retirement plans. A good divorce attorney will help you navigate these questions, bringing in the appropriate professional expertise to help you make an informed decision.
If you or your spouse has decided that a divorce is in your future after years of marriage, let us know and we can help assess and protect your rights. While a divorce can be a difficult process to go through, our goal is to help you find the silver lining and start a new chapter in your life, regardless of how old you are.
Please contact our office to discuss your situation and learn about your options.