People of all ages may discover that they need to divorce their spouse. Even people who have been married for decades may eventually find that they have grown apart from their partner. With retirement looming, unhappily married individuals may want to seek happiness in their later years by ending an unhappy marriage.
Too many people may put off seeking a divorce out of concern for how it will impact their financial situation. This is particularly true for those who are close to retirement age or who have already retired. Living on a fixed income is difficult enough, and when you add the financial uncertainty that accompanies divorce, it can leave people in a precarious position.
As a result, some people who would be happier divorced put off seeking the end of their marriage, sometimes indefinitely. Understanding how divorce could impact your finances may give you the courage to move forward with filing your divorce in Florida.
Expect to split your retirement assets with your spouse
The most significant impact that divorce has on retirement stems from asset division. The courts will split up the possessions, assets and debts you and your spouse acquired in your marriage. Unless you have a legally sound prenuptial agreement or have agreed to terms for an uncontested divorce, all decision-making authority about asset division lies with the courts.
It can be frightening to have your financial future in the hands of a stranger. Understanding how Florida courts approach asset division may minimize your concerns. Florida uses an equitable division standard. In other words, the courts will do their best to split up all your marital assets and debts evenly between spouses. This will include retirement accounts and pensions, even if they are in the name of only one spouse. Even military pensions and employer-matching amounts in a fund could wind up split between spouses.
Provided that the balance in the account was acquired during marriage, it is subject to division. There are many ways for the courts to approach this, from spousal support to Qualified Domestic Relations Orders that split existing accounts between spouses.
You will likely diminish your overall assets to pay for the divorce
Contested or litigated divorces are often quite expensive. You can expect to pay thousands, if not tens of thousands, of dollars to end your marriage. The more protracted and contentious the divorce, the more it could end up costing you. It’s important to understand that the amount you spend on your divorce will likely impact the assets you have available for your retirement.
However, simply because you must share assets with your spouse in a divorce and spend your assets paying for the divorce doesn’t mean you should stay married. It simply means you may need to reconsider your expectations for retirement.
It is possible to enjoy your retirement with less money, so long as you plan carefully. Returning to work for a few years or even changing your plans as far as living arrangements or travel could help you enjoy financial security in your retirement years after a divorce.