The Rise in Late-Life Divorces and Resulting Financial Impact by Sandi Perez, CPA/ABV/CFF, CFE

Posted on April 22, 2015 by Sandi Perez

According to a 2014 study by Bowling Green University’s National Center for Family and Marriage Research, the divorce rate for Americans over 50 has doubled since 1990.  For those over 65, the rate is even higher.  With this rise in graying divorces comes an assortment of unique challenges related to divvying up assets, including often-sizable investments and retirement plans acquired and allowed to grow during marriages span that spanned 20 years or longer.  Moreover, by this stage in a marriage, much of an individual’s business and personal matters are so closely intertwined that untangling them can be a difficult process.  This is especially true when considering the ease with which one may comingle and hide assets from a soon-to-be ex-spouse.


In many ways, the issues facing late-life divorcees are very similar to those experienced by their younger counterparts.  However, a couple’s age, health and even their grown children can negatively influence the divorce process and the way in which each spouse emerges from the dissolution of the marriage.  To protect the interests of both parties and ensure each leaves the marriage with their fair share of assets, couples should consider engaging professional counsel, including divorce attorneys, trust and wills attorneys and forensic accountants, to address the following issues specific to late-life divorces.


Retirement and Estate Plans

For older couples, the later in life their divorce, the less time they will have to recover financially.  In the current economic environment, it is common for one or both spouses to continue working past the age of retirement.  However, when a divorce occurs, the working spouse(s) often desire to retire, close shop or sell their businesses to enjoy their golden years.  The result of this will change each party’s future income and lifestyles significantly, with both sharing in reliance on Social Security, retirement assets and savings.


It is important that both parties have a clear understanding of how retirement and benefits plans were originally established and the tax consequences of keeping, selling or dividing those assets.  Legal and financial professionals should be engaged early to analyze each document carefully to determine the impact of distribution under various scenarios.


Similarly, older couples headed for divorce should collect their wills and estate plans and ensure their beneficiaries are up-to-date prior to filing.   It is important that they have their trust and estate lawyers work with their divorce lawyers at the beginning of the process, especially if the division of assets will result in a material changes to the wills.  Often, these changes do not occur until after the divorce is finalized and assets are distributed. However, due to the advanced age of a late-life divorcee, waiting to alter wills may not be the most prudent option.



Due to the advancing age of late-life divorcees, there is an increased likelihood that one or both spouses will have health issues.  The divorce process can exasperate these medical matters and put additional stress on already fragile physical and emotional states.  It is important that divorcees be direct in disclosing illnesses with their legal and financial counsel and address the need for ongoing medical care in the divorce agreement.  When an individual enters into a divorce with a serious illness or develops one during the course of the divorce process, that party may push for bifurcation, in which the court dissolves the marriage, but the financial aspects of the divorce remain pending.


The Children

Unfortunately, the agenda of adult children who have sided with one parent influence the outcome of late-life divorces.  For example, there could be a new or long-standing riff between the children and one parent, or the children caring for one parent may resent the other’s lack of involvement in the daily routines of doctor visits, or they may disagree with the actions of the other parent.  In each of these cases, the children’s agenda drives the direction of the divorce negotiations and may lead to complications during settlement.



With an increase in gray divorces comes an equally growing rate of later-life remarriages.  When a late-life remarriage occurs, issues such as alimony from a prior spouse, inheritances and retirement and government benefits may make the road to happily-ever-after more complicated.   Prudent couples will consider prenuptial agreements to protect both parties and their heirs should the marriage end in divorce or death.  While open to later interpretation and attack, prenups will help to ensure that one enters into a new marriage with their eyes wide open to the other person’s assets and liabilities.  This will help both parties to build a strong foundation on which they may build a solid financial future.


The Family Law Services practice of Berkowitz Pollack Brant has extensive experience working with families, attorneys and the courts to simplify complex financial information prior to, during and after divorce. Its team of professionals helps to uncover hidden facts, value assets, develop case strategy and provide credible and reliable expert testimony at mediations, hearings and trials.


About the Author: Sandi Perez, CPA/ABV/CFF, CFE, is director of the Family Law Forensic Services practice with Berkowitz Pollack Brant.  She can be reached in the CPA firm’s Fort Lauderdale, Fla., office at (954) 712-7000 or via email