Much is written these days about “silver splitters,” and “Gray Divorce.” Open any newspaper or women’s magazine and you’re sure to find something on the subject. It seems to be this year’s hottest topic in the divorce arena. Silver splitters (divorcees over 50 who fall into the baby boomer generation), are growing in number. However, the Office of National Statistics published results in 2014 showing that the divorce rate for 2012 (the latest figures available) for men and women aged 50-54 is almost double the 55-99 and 60+ age groups. The “Silver Splitter Syllabus” will help guide you through your Gray Divorce and help you prepare and make the decisions needed to get exactly what you want.
BECOME A STRATEGIC THINKER
DO NOT BE IMPULSIVE
Whatever you do. Split second decisions like hiring the first attorney you talk to or starting to negotiate with your husband will only end up biting you from behind down the road. Be methodical, think about what you want from your divorce. The clearer you are with yourself about what you want, the easier (and cheaper) the whole process will be.
BE SELECTIVE WITH YOUR SUPPORT SYSTEM
Close friends are comforting, just remember that they are likely to be emotionally involved in your divorce which will make it hard for them to be objective. Sometimes it is best to seek support from someone who does not know you and can give you an unbiased opinion and help you consider different options. An experienced mediator can be a helpful tool through the process and can save some money by reducing time in court down the road.
THINK ABOUT WHERE YOU WANT TO LIVE
The biggest asset most of us have in our lives is our home. You may have lived there many years and raised your family there. You may have dreamed of spending your retirement there, keeping space for family Christmases and grandchildren. Many women will often just ask for the house and be willing to concede other assets such as their husband’s pension.
But stop. Wait. As well as being an asset that will increase in value over time, in the short term, your home is also a liability in respect of ongoing bills and maintenance costs. Ask yourself: can you afford to run the house if you retain it as part of your settlement? Even if you can, do you feel you’ll be able to move on emotionally while living in the same house as before?
BECOME PERSONAL FINANCE SAVVY
Before you begin negotiations, ensure that you understand what the finances of your marriage are.
You may be a woman who has managed the family finances, known what you and your husband earn, the values of investments, life policies, other properties you may own. You may know your liabilities – credit cards, loans and mortgage.
Or, you might have no idea where you stand financially because your husband has provided for you and dealt with the family finances your entire marriage. Divorce is a time when you need to understand what the marriage assets and liabilities are. If you suspect that there are assets that your husband is hiding, you need to get legal advice about this.
When you and your spouse were married, you believed that you would be together until the end of time. When marriages do not work out, it is the utmost importance to either revisit the Estate Planning decisions and make the necessary modifications, or, talk to an experienced Estate Planning attorney to help you with your plan.
Remember, if you currently have an estate plan, it is critical that you properly update your documents after a divorce, not doing so could result in your ex receiving assets or control over decisions that you might want your children or another family to have.
BANK ACCOUNTS AND CREDIT CARDS
If you have joint bank accounts and credit cards, you need to cancel these immediately. Inform your bank and credit card providers as soon as you make the decision to separate, or it’s made for you.
If you have worked, you may have your own pension. If your husband has worked, he may also have a pension. Generally speaking, because men don’t take big career breaks for family-raising, their pensions are bigger than women’s. Your husband’s pension may well be the second biggest asset of your marriage (and it could be the 1st). The cash equivalent value of all pensions will be assessed on divorce. There are three options for dealing with pensions:
- Earmarking – this has generally fallen from favor but effectively, it means that when your husband retires, some of his pension is paid to you. It’s problematic in that you need to keep an eye on his pension, and it doesn’t allow for a ‘clean break’. If your husband dies before he draws his pension, you may get nothing and if he dies after retirement your payments will stop.
- Offsetting – this occurs when each party keeps their own pension and the greater value of one is offset against other assets, usually the family home. So, for example, many women want to keep the family home and in return, the husband keeps his pension.
- Pension sharing – this is probably the most popular option these days. If your husband has a greater pension pot than you, sharing his pension means that you will have an income on retirement. Pension sharing allows for a ‘clean break’. Once the order is made, there is no need for further court orders. It gives you clarity and certainty.
Remember that you can’t access that pot until you reach your normal retirement age. It is not cash available now, unless you are old enough. You will perhaps have heard about the pension reforms that came into force in April 2015 (which are outside the scope of this article), which may mean you will be able to access some of that money immediately.
Whatever your age and circumstances you may be going through, a divorce is one of the most upsetting, draining and mentally exhausting experiences you can go through.
There’s very little you can do to mitigate the emotional turmoil involved but taking some time to think and plan before taking action is a must. Next, getting clear about the points raised in this article will help you move forward efficiently at what is a very difficult and often complicated time.
If you have any questions, or need help with your “Gray Divorce,” the attorneys at Bedlam Law specialize in the divorces within the Baby Boomer age range. Our team will help you navigate through Gray Divorce successfully. 405.232.2444, give us a call, we can help!