I recently talked with family law attorney Robert Salzer on the Pennsylvania Bar Association’s “Law in the Family” podcast about “gray divorce” and the considerations related to parties divorcing later in life. There’s no firm definition about what constitutes a “gray divorce” in terms of age or length of marriage, but I think that there are some general traits they share: grown children; closer to retirement than not; beginning to look closely at financial resources, medical coverage, and lifestyle expectations as the parties transition away from their prime working years and into a later stages of life.
For the generation of people who might fall within a gray divorce, there is anecdotally a good percentage of single household incomes and a party who may have been out of the work force for a period of time while children were growing up and they may not have returned to employment at the same level, if at all. For people in this situation, divorce may represent a huge change of lifestyle by needing to return to work in some capacity and the logistical and emotional challenges attendant with re-employment after being out of the workforce for a long period of time.
The complications and concerns arise from effectively splitting an estate in which there is not the benefit of time to rebuild or build upon the portion of the estate they’re receiving. Involving financial planners in such cases can be very important to help identify realistic cashflow projections, as well assessing the current and projected medical care needs of a party. These are also cases in which getting a firm idea of what a party qualifies for under their or their spouse’s Social Security benefit and Medicare’s coverage may (or may not) provide will be important. The timing of when to claim these benefits becomes an important discussion, as well.
Ultimately, gray divorces involve deep conversations about what someone’s needs will be to live securely in the later years. This serves the purpose of understanding those needs while also recognizing and considering the anxiety a party may experience as they process a future that is different from what they may have anticipated over a long-term marriage (or a shorter, later-in-life marriage).
While many of the issues of a gray divorce may not be that dissimilar from most divorces, the nuances created by the tension between assets, income, and time constraints for building on the estate requires thoughtful planning and strategizing.