Divorce rates in the U.S. have been steadily dropping for the last two decades – at least for younger couples. But within that same timeframe, the divorce rate for those after age 50 has doubled since 1990.
The phenomenon – nicknamed “gray divorce” – could be attributed to a variety of factors. People are living longer, women are now in the workforce and are financially independent, and past stigmas around divorce have all but dissipated.
However, new research from the National Center for Family & Marriage Research has found that as more older individuals opt for gray divorce, they may be destroying their finances on an unprecedented scale. Unfortunately, the financial toll of a late divorce is significantly worse for women.
The financial effects of gray divorce on women
Both men and women who divorce after 50 can expect their wealth to drop roughly 50%, according to the findings. Most couples expect some loss of wealth; after all, divorce splits up a couple’s assets. But devastatingly, older Americans nearing the end of their careers don’t have enough time to bounce back financially – particularly women.
The study found that the standard of living for women after gray divorce drops a staggering 45%. Older men, by comparison, only see a 21% drop. What’s more, is a separate study from the center found women 63 and older have a poverty rate of 27% after gray divorce – higher than any other group at that age.
Finding a new partner or remarrying can restore the financial devastation of a gray divorce, but women often draw the short end of the stick here, too. While 37% of men find a partner in the decade after a late divorce, only about 22% of women do. Older men tend to seek out younger partners, thus limiting the pool of eligible bachelors for older women.
The bottom line
Divorce is difficult at any age but has serious financial implications for women over 50. While it’s possible to emerge from gray divorce with your finances the same as before, you must go in with a plan. If you are considering a gray divorce, you can seek advice from a financial advisor or an attorney about how to safeguard your financial security.