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Later in life divorce can upend retirement planning

Pew Research polls indicate that the numbers of younger couple who are ending their marriages has declined in recent years. However, for those aged 50 and over, the divorce has more than doubled. There are many reasons why Colorado residents chose to seek a dissolution, but such decisions do not come without a price tag.

Many couples may have imagined that retirement would bring the opportunity to share quality time with each other since their children would likely be out on their own. Unfortunately, many have discovered that they no longer have common interests, and they realize they do not wish to live the rest of their lives with a spouse they no longer love. However, the longer one waits to seek a divorce, the more likely it will have a negative impact on his or her retirement planning.

Splitting certain retirement and pension accounts is not a simple process and can carry a hefty penalty if not done carefully. Along with ensuring that 401(k)'s are divided properly, the cost of seeking a divorce can take a toll on finances as each party seeks to hold onto the assets he or she will need later in life. Along with potentially losing half of the resources saved for retirement, the older person may struggle to replace lost savings due to less work opportunities later in life.

Older couples may benefit from careful planning if a divorce is in their future. Saving for retirement when one is on an essentially fixed income can create stress on both finances and emotional well-being. Colorado residents who are preparing for a 'gray' divorce may be best served by consulting with an experienced divorce attorney who can help them determine the best options for an equitable settlement.

Source: The Washington Post, "A 'gray divorce' can devastate your retirement plans. Here's how.", Michelle Singletary, March 26, 2018

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