If you are 50 or older and facing divorce, you need to look at the financial impact this parting of the ways will have on your financial future.
Start by learning all you can about your current finances. Using this information as a starting point, work out a plan for ensuring that you will have enough money to live on in the years ahead.
About the financial strain
By the time you reach the age of 50, you and your spouse have probably accumulated assets such as a home, vehicles, investments and retirement accounts. You have a mortgage—perhaps more than one—credit card bills, car loans and other debts. The more assets you have, the more complicated your divorce and the more important it is for you to understand what happens afterward in terms of your finances. Later in life you no longer have the time to build another nest egg, nor do you have time to re-educate yourself and build a new career. However, you do have some options.
Consider rejoining the workforce
If you already work, you may need to postpone your retirement. If you must rejoin the workforce after a number of years away, think about what you would really like to do, then go for it. The good news is that there are many openings in virtually every field; you are sure to find a good fit for your skills. Even if you receive alimony payments, having a second income stream, even if it is a small one, helps with financial security.
Prepare for lifestyle changes
You may need to downsize in terms of lifestyle and pay closer attention to your monthly budget. You may think you want to keep the family home, but bear in mind that this is an illiquid asset that requires property tax payments and maintenance. Instead, think cash flow: spousal support, investment accounts and retirement funds.
Remember that Massachusetts is an equitable division state, so learn what to expect when you reach the property division stage of your divorce. Seek legal counsel to help you make good decisions, replace anxiety with purpose and plan for a sound financial future.