"Grey divorce" is a recently coined term that refers to divorces that happen to people who are age 50 or older. The National Center for Family & Marriage Research finished a study in 2009 based on the U.S. Census that indicated that about 25 percent of divorces are grey divorces. 1 In 1990, that number stood at about 10 percent. With the baby-boomer generation continuing to age, that percentage is expected to keep rising.
Divorce impacts the 50-and-older crowd differently than it does younger people, especially financially. Three main economic areas where they are hit include the division of martial assets, the marital residence and, perhaps most importantly, retirement benefits/pension accounts. A divorce later in life can seriously change and delay retirement plans as this age group might struggle to recover their financial health.
Couples may have more marital assets to consider during a grey divorce. The Nevada courts apply a legal principle called "community property" to determine the appropriate division of marital assets. This method of distribution seeks to isolate those assets which were acquired/accumulated during the marriage and attributes those assets to the "community". These "community assets" are then subject to equal division between the parties. Those assets which are not designated as belonging to the "community" are then confirmed as the separate property of one or the other spouse and are not divided by the court. A significant percentage of divorce litigation, particularly in second marriages, is spend battling over the characterization of assets as either community or separate property.
Another important decision divorcing couples make is over what do with the home. In some cases, it can be an added expense that burdens the person who keeps it. That person may not have the finances or the energy to maintain a residence that is now too large for their needs. While the Las Vegas housing market has picked up, sellers still might not recoup their equity from a home depending on when they purchased it and how much they owe.
When it comes to retirement, statistics show that divorced people have about $10,000 less in retirement benefits than their married counterparts. 2 Couples considering divorce in Las Vegas should take a long look at determining the division of assets, specifically the division of their retirement benefits. While one partner may think that retirement benefits belongs to them because they earned it, the law generally says that assets acquired during marriage are joint property and belong to both parties.
After a divorce in Las Vegas, partners also need to remember to change beneficiary designations when appropriate. If they do not know how to manage daily finances, they should also learn to balance the checkbook and pay bills.
1) Wall Street Journal Article
2) Huffington Post Article