A Gray Divorce refers to a demographic trend that has seen an increase
in the separation or divorce of older couples who have been married for
a long time.
Divorce rates for couples over 50 have doubled in the past decade. These
divorces affect financial security issues due to the fewer remaining working
years of these couples.
Support for dependent spouses is a big issue. Developing a career later
in life is often not a viable option. As a New York divorce attorney and
mediator I see older couples with long marriages divorcing often these days.
A client of mine, Sara, had been a homemaker for 20 years, raising three
children, and working part-time from home making costume jewelry, earning
about $6,000 per year. Her husband was in finance, earning a high six
figure salary. When Sara called me she was very concerned about how she
was going to meet her expenses after the divorce having only earned $6,000
per year working from home.
As part of my divorce strategy, in order to supplement her spousal support,
we arranged for her husband to transfer more than the typical 50% of his
retirement assets to her. Since she was over 59 1/2, she did not have
to pay a penalty to withdraw and use this money. Since she had to pay
taxes on what she took out, we also arranged for her to receive extra
funds with which to pay the taxes on shrare. I prepared a Qualified Domestic
Relations Order so this could be a tax-free transfer to her. Another way
for her to be protected was to have her husband elect survivor's benefits.
She was also eligible for social security based on her husband's earnings
history, since they had been married for over 10 years.
The couple had other assets, including securities accounts and real estate.
After a long marriage, Sara was entitled to perhaps 50% of these assets.
Tax issues had to be reviewed carefully. There is an exclusion from income
for gain from the sale or exchange of a principal residence of up to $250,000
for single individuals, and $500,000 for couples filing jointly.
There are three requirements for entitlement to these exclusions. We had
to make sure these were met, and also figure out whether the house sale
would take place before or after the divorce was final.
Since the children were over 21, the couple did not have to deal with child
support or custody in their agreement. Her husband was already paying
for college and graduate school for the children.
Another client of mine was on disability, and we had to figure out how
she was going to pay her bills after the divorce. Her disability income
was tax free, but, after a long-term marriage, she was entitled to lifetime
"alimony." This is another example of the typical problems that
have to be handled when people divorce at the age of 50 or older.
It takes sophisticated legal advice to plan a late-life divorce. Sometimes
I engage the assistance of my team of experts which consists of trust
and estate attorneys, accountants and financial advisors, to make sure
all issues are thoroughly addressed.
Sara was lucky because there were sufficient assets and income to provide
financial security for her, and her husband was astute enough to realize
that she was entitled to what she would receive, and that it was better
to negotiate a settlement than go to court.
There are many other instances in which wealthy spouses try to hang on
to all of their money, which is why we hear about those cases so often
in the news.
It takes a divorce attorney with sophisticated knowledge to do the strategic
planning necessary to get the best possible del in this type of case.
With over 35 years of experience as a divorce attorney and mediator I have
the expertise to skillfully create a financially viable plan for you and
your family if you are considering a divorce at a later stage of life.
Don’t stay in a long term unhappy, unhealthy marriage that’s
just dragging on and on because you are afraid you won’t be able
to provide for yourself or your family. Call me, let’s chat about
what is possible.
During the ongoing COVID-19 Pandemic all our
FREE 1 HOUR CONSULTATIONS are
conveniently conducted virtually by telephone or TeleDivorce by Zoom or Skype to reduce
risk and maintain safety for everyone!
I look forward to showing you that providing for your financial future
is possible! Let me show you!
Stay Home, Stay Healthy and Stay Safe!
Call New York Divorce Lawyer Lois Brenner now to book your free consultation.
We still have some time slots available this week.