We are all used to the saying, “50% of marriages end in divorce,” but recent research pins the figure between 42-45%. The main contributing factor seems to be that fewer people are getting married. Many are opting to live together instead of tying the knot. There is one demographic, however, where divorce rates seem to be on the rise, even doubling – for those over age 50. This phenomenon is known as the “gray divorce.”
Divorce is painful for both parties but can be more difficult for women over 50. It’s especially hard if the woman has not been in the workforce for many years depending on their spouse’s salary or stayed home with children instead of advancing in their career.
If you are faced with such a life-altering event, there are some steps that you can take right away to help ensure your financial stability moving forward.
Get legal and financial advice
Some couples try to forgo hiring an attorney to save costs and do the divorce paperwork themselves. This route may work if there are not a lot of assets, or if you both can agree 100% on how to divide things. If your situation is more complicated (if you believe that your spouse may have hidden assets or you need to figure out child support and spousal support), hiring a professional can often lead to a better outcome.
Figure out your expenses
List what your living expenses are (rent/mortgage, food, utilities) and how much money is coming into the household. Understanding these expenses prior to the divorce proceedings begin gives you an advantage during negotiations.
Prioritize your other spending
Look at some of your “extras.” Are you paying monthly for a gym membership or classes that you don’t attend? Do you buy your morning coffee or lunch every day? Cancel that unused membership and consider making your coffee and brown bagging it and put the savings towards bills that need to be paid.
If you are covered on your spouse’s health insurance, your coverage could be canceled. That may also apply to auto, home or life insurance if your spouse pays the premiums. See if your employer offers a plan or if you can stay on his health insurance until you can make other arrangements. Insurance brokers can assist in “shopping” coverage, at no charge to you because the insurance companies pay them.
Invest in your future
If you are not already enrolled, talk to your employer about their 401(k) plan. If they don’t offer a plan, you can set up an individual retirement plan yourself. Both the IRS and U.S. Department of the Treasury has information on their website regarding individual retirement accounts including traditional and Roth IRAs. You can set up an IRA with a bank, financial institution, life insurance company or stockbroker. The point is to save as much as you can as soon as you can.
Become more involved
Investing in your time can be just as valuable as investing with your money. Women often become engaged in their community for personal support, while men participate for financial support, mentorship and networking. Utilizing your network can help you succeed in both your personal and professional life. Surrounding yourself with an active community and becoming more involved with areas outside your comfort zone can help keep you busy during and after a divorce, and create a support system that you can lean on in times of personal and financial stress.