When a couple divorces, almost all aspects of their life are affected. Their family dynamic changes, their assets are subject to division, and most often, their finances take a hit.
Of course, the implications can be even worse for couples who divorce later in life. The possibility of divorce can be frightening for all couples, but those closer to retirement may have an extra concern to consider.
What can happen to your finances?
Often, assets are split in half during divorce, which means you and your soon-to-be ex-spouse may come out with an equal share of your retirement fund.
There are other assets that will be divided too, such as:
- Savings accounts
- Property (including your home)
- Paintings, antiques, family heirlooms, etc.
Any assets of value may be subject to division, but you and your spouse may be able to come to an agreement regarding asset division on your own.
If that’s the case, you may be able to use an alternative dispute resolution (ADR) method, which can save time and money. ADR methods help couples resolve issues and reach an agreement without a courtroom battle.
Adjusting your financial plan
Even if the divorce process itself isn’t too expressive, you may have to adjust your spending habits.
Reassess your finances, and increasing your savings help you achieve your financial goal after divorce. Retirement may be more expensive on your own, and you may not receive the same benefits you and your partner shared as a married couple.
Don’t ignore retirement planning
Although it may be overwhelming to think about right now, its crucial that you take a look at your finances when the stress of divorce has somewhat subsided.
By understanding what your financial situation is post-divorce, you can start planning for the future.