Retirement accounts, Social Security and health insurance are matters with which many older Utah residents are concerned. When the parties are over the age of 50 and getting divorced, these issues often take center stage. This makes divorce matters for these so-called “gray” couples different from young couples who may not have as difficult a time rebuilding finances after a divorce.
During the marriage, couples often work together to build retirement accounts that would support their lifestyle later in life. When a couple divorces, those pooled resources are often split, which can significantly reduce a nest egg. A divorce decree is often not enough to effect the division of a retirement account. It is important to provide for a Qualified Domestic Relations Order for the transfer of funds and to avoid any taxes and penalties ordinarily incurred.
However, a retirement account is often not enough. When a person is young, health insurance is often more about isolated incidents rather than chronic conditions. Older Utah residents may require ongoing medical care — and sometimes regular medications — as a part of daily life. The cost of that care can be overwhelming — especially without health insurance. It may be possible to negotiate the payment of health insurance as part of the divorce settlement.
Social Security benefits are also a consideration since they may be an important part of a person’s income stream. It may be possible to receive additional benefits based on the work record of an ex-spouse if an individual meets certain criteria. Both parties may need to take this into consideration when negotiating a settlement.
These are only some of the divorce matters that take precedence for older couples. Negotiating a settlement will most likely focus more on property division. Each party needs to understand what he or she will need in order to start over, which requires as complete an understanding of the parties’ financial situation as possible.
Source: USA Today, “Protect finances in later-in-life divorce“, Anna Helhoski, Nov. 23, 2014