Getting a divorce after age 50 comes with its own set of problems. Chief among them is your retirement account.
Your savings are not necessarily safe from divorce proceedings, and because of your age, you have little time to restock the account. On the bright side, strategies are available that can secure your financial future.
Steps with your spouse in mind
Remember these initials – QDRO. They stand for “Qualified Domestic Relations Order.” If you have one, it can give you access to your ex-spouse’s employer-sponsored retirement plan.
You also may have a right to your former spouse’s Social Security retirement benefits. You can qualify if your marriage lasted at least 10 years and you have not remarried. What you collect has no impact on your ex-spouse’s benefits.
It also is important to document all assets and debts. These include joint accounts, investments, business records, mortgage statements and others. Recent tax returns are an excellent source of assets.
Steps with yourself in mind
Update your retirement plan because you have different goals now that you are single. Review your portfolio, your beneficiaries, your expected retirement date and other details.
As soon as you are aware that a divorce is in your future, create an emergency fund for yourself. It should contain enough money to cover three to six months of expenses.
At the same time, determine which marital assets are yours. This will help you adjust your lifestyle following your divorce. Should you cancel an expensive vacation? Should you be preparing to move from a house into an apartment?
Steps with your future in mind
Many people discover the emotional impact of their divorce overshadows financial fallout. Learning to live on less, especially at first, is disheartening and may seem like the end of the world.
This is why surrounding yourself with supportive people is important. Also, consider individual or group counseling. The challenge of preparing for your post-divorce life is not one that you have to face on your own. It could be the freeing break you need and deserve.