According to the Pew Research Center, the divorce rate has more than doubled for people over 50 since the 1990s. The Pandemic also adds to the uptick, says AARP’s recent article entitled “Getting Divorced? It’s Time to Update Your Caregiving Plan.”
A divorce can be financially draining. Moreover, later-in-life divorces frequently impact women’s finances more than men’s. In addition to depressed earnings from time spent out of the workforce raising children, women find themselves more financially vulnerable post-divorce and more likely to serve as caregivers again in the future. Even so, for partners of all genders, it is crucial to consider the longer-term financial outlook, not just the financial situation you’re in when you are dissolving the marriage.
You and your spouse will be dividing assets and liabilities and the responsibilities regarding spousal support. How one of you will live if the other gets sick or passes away should also be part of this conversation.
Consider where you’ll need to make changes. One may be removing your spouse from beneficiary designations on all your accounts. (In some states, this is automatic.) Your divorce agreement may also include buying life insurance or maintaining a trust or beneficiary designations for one another.
Create or update your estate plan immediately. It would be best if you also asked your estate planning attorney to review your marital agreement. They will have suggestions about aligning your estate plan with your divorce obligations. If you and your ex are co-parenting children, your estate plan should address who their guardians will be if both biological parents pass away. It is also important to address who will manage any inheritance; if you don’t want your ex-spouse handling assets, you may leave them to your children.
Create your life care plan, naming health care proxies or surrogates (who will take care of your medical affairs if you require caregiving). Designate a financial power of attorney (who will take care of your finances and legal affairs), and name a guardian for yourself if you’re incapacitated.
Consider how your divorce will impact your children and extended family if you need caregiving. At a minimum, agree between yourselves what level of contact you can manage and, if you share children and loved ones, know that your lives will cross along the way.
While your marriage may not last, the connections will so make a wise plan.
Reference: AARP (Jan. 25, 2022) “Getting Divorced? It’s Time to Update Your Caregiving Plan”