Select Page

Divorce can turn anyone’s life upside down. But for those nearing retirement, an additional concern rears its head: What will happen to the retirement funds I worked so hard to build? The consistent increase in the divorce rate for couples over 50 over the last few decades means many people are asking themselves this question. The two primary challenges for this age group are addressing a limited pool of assets and creating a property division that leaves both parties in a comfortable situation for retirement. 

Dividing assets that are unlikely to grow

All property and assets acquired during a marriage are subject to division in divorce. For couples nearing or in retirement, this often means they are dividing a closing pool of assets. Rather than splitting assets based on each person’s future earning potential, couples over 50 must divide whatever they have. For many couples in this age group, the asset pool includes:

  • Bank accounts
  • Real property
  • Social Security benefits
  • Retirement accounts
  • Brokerage accounts
  • Pensions

Since their time in the workforce is either limited or already over, couples over 50 must carefully consider how dividing their retirement assets will impact their lifestyle. However, this challenge can in many cases be offset by the fact that people in this age group tend to have built more assets by the time they divorce.

How “equitable division” impacts retirement assets

Rather than splitting marital property down the middle, Pennsylvania divides property based on “equitable division.” Assets and liabilities are divided according to what the parties and the law view as fair. Equitable division gives couples negotiating property division as well as family court judges an opportunity to get creative. One person might be willing to take a smaller portion of retirement assets in exchange for keeping the marital home, for example. Or, a couple in their 60s might decide to sell the house and split the profits in order to increase the liquidity of their assets.

Dividing retirement funds may be a scary prospect. However, it does not mean that you have to give up all of your retirement dreams. Consulting with an experienced divorce attorney can help you and your spouse find a property division solution that will work for you.