Regardless of the timing of your divorce in Texas, your retirement plans will require modification. If you choose to divorce your spouse as you near retirement, proactively planning for your future becomes even more critical.
Understanding the impact of your divorce on your future and ability to retire may help you visualize what needs to change to maintain a desirable standard of living.
Complications of gray divorce
In an interesting statistic shared by Forbes, a study by Pew Research revealed a stunning 109 percent increase in divorce in couples 50 years old and older over the past quarter-century. If you feel that your spouse’s interests or priorities no longer align with your own, you may no longer desire to maintain your marriage.
Some of the challenges you may face include the adjustment to affording the costs of living independently since you will no longer share those responsibilities with your spouse. As you near retirement or if you are already retired, you may no longer have access to growing assets when compared with a younger couple who’s earning potential still has the probability of increasing.
Implications of splitting retirement assets
Retirement assets are among the more challenging marital assets to split because there are often legal implications. For example, IRA transfers without costly tax consequences require the implementation of a Qualified Domestic Relations Order or QDRO. Pensions and 401Ks also require careful consideration through separation to protect you from having to pay costly taxes and fees for early withdrawal.
The sooner you are able to take control of your finances and identify new retirement goals, the better. Your proactivity may help to reduce your losses, as well as aid you in optimizing the time you have to prepare for your future. If you would like to learn more about recovering from a gray divorce, please visit our web page.