The divorce rate among baby boomers remains high in the U.S. During the last 20 years, the divorce rate has doubled for people age 50 and older. In 2010, one in four divorces in the U.S. was between couples in that age group.
One of the biggest concerns for older couples getting divorced is how it will impact their retirement needs. The main reason so many couples getting divorced are concerned about their retirement accounts is because the money that was supposed to support both of them in retirement is now being split in half and will need to support two separate living arrangements.
It costs a lot more to fund two single people’s retirement plans and living arrangements compared to married couples sharing a retirement plan. While some baby boomers are able to save more money at the end of their career for retirement, many people are not able to do so.
In many cases, divorced couples end up delaying their retirement or changing their retirement plans to be more affordable since their income has changed. Reports show that many baby boomers end up pushing back their retirement to age 67 or 68 instead of retiring at age 65.
In addition to trying to save for retirement separately, divorce people now have to support themselves on their own. This includes daily expenses as well as separate vacations and visits to see family members and children.
Every divorce faces challenges. For baby boomers and older couples going through divorce, one of the biggest challenges and changes to their life will be financially. That is why it is important for older couples getting divorced to consider all the financial implications divorce will have on their life and to plan accordingly.
Source: The Daily Journal, “Gray divorce rise doubles retirement needs,” Rodney Brooks, Feb. 26, 2013