Sometimes, couples can make it through multiple decades of working life and raising a family together only to near retirement and realize that they will not enjoy one another’s company anymore. No one should stay in an unhappy marriage solely for financial reasons, but many couples at or near retirement age find themselves doing exactly that.
Couples become so worried about the quality of life they may be able to secure during their golden years with reduced retirement savings that they end up compromising that quality of life by staying in a marriage that makes them miserable.
There is no question that any divorce is going to have an impact on your finances, and gray divorce may be harder to recover from than one earlier in life. Still, that doesn’t mean you should avoid divorce just to save money. There are ways that you can move forward with ending your marriage without totally destroying your retirement plans.
Can you and your ex agree to an uncontested divorce?
Perhaps the simplest way to reduce the financial impact of a divorce is to reduce how much money the divorce costs. Going through the court system and litigating every little detail of asset division and spousal support can quickly add up to be a very expensive process.
If you can negotiate directly with your spouse or go through a process like mediation to set mutually agreeable terms, you may be able to divorce for a fraction of the cost of a litigated, contested divorce. Looking realistically at your household’s assets and debts and how the courts would typically divide them can help you make decisions that both of you can agree upon.
It’s important to understand that you will both have to make compromises to reach terms in this kind of situation. However, mediation and direct negotiations both allow you more control over the ultimate outcome than putting all the authority for decision-making in the hands of the courts.
Look at your plans for retirement and get ready to make changes
Divorce usually entails dividing your assets, which means you will have a smaller savings account or retirement funds than you had planned for. Additionally, that same amount of savings will have to cover two individual retirements instead of one joint retirement.
From covering the cost of two houses or apartments to the potential costs associated with losing out on your spouse’s help around the house or yard, you may feel as though you simply no longer have enough money to retire.
Changing your plans can make you feel more confident about retiring after a divorce. From changing your investment strategy or working longer to adjusting your expectations regarding housing and travel during retirement, there are ways to stretch what funds you do have for retirement to make them last even longer.