22 January 2015
Moving on – divorce after 50
The number of people over 50 who are divorcing continues to rise. For some this may be because, after years of unhappiness in the marital home, they have seen their children reach adulthood. For others, it may be a mutual decision based upon different wishes for retirement, or the decision may have been imposed on them by a partner.
Whatever the reason, separation and divorce, particularly after many years together, can be a daunting decision fraught with concerns about the financial future and the possibility of a lonely old age.
“Even for those baby boomers who are looking forward to the freedom their separation might bring – maybe an adventurous ‘gap year’ – the reality is that sooner or later you have to come back and will need a home and funds to pay your bills and other living expenses,” she said.
“We know that people who divorce later often worry about loneliness and their longer term future. And, if one party has been used to their spouse dealing with all the practical and financial matters during their marriage, they can find the process of divorce and the thought of dealing with their finances themselves intimidating.”
Sue says practical guidance, for instance from financial advisers and support networks as well as an experienced family solicitor, can make a real difference because there are likely to be a variety of possible solutions.
In a lengthy marriage, the family home and any assets will most likely have been built up as a product of a couple’s joint endeavours. A specialist family lawyer will be able to provide advice about what would be the appropriate division of those assets, taking account of all relevant factors, with the needs of both parties usually at the forefront.
Very often, issues such as access to pension rights – traditionally built up by a husband while the wife looked after the children – will need to be considered.
Sue explains that a court can make a pension sharing order which would transfer part of one spouse’s pension to the other, ensuring that each party has a pension entirely independent from the other, from which they can derive an income in retirement.
However, she warns that there are a number of issues to consider. These include the age of both parties, when can a pension be drawn, and what happens to the tax free lump sum. And, if a pension fund is in excess of a protected lifetime allowance and is not yet being paid, then advice needs to be sought from an actuary or a specialist pension financial adviser to ensure that the funds are shared in the most tax efficient way.
Separation or divorce
“Sometimes, divorce isn’t the best way forward,” continues Sue. “I recently acted in a case where the parties were in their late 80s/early 90s and advised them to obtain a decree of judicial separation rather than a divorce.”
Sue's advice was predicated on achieving the maximum income for both parties for the rest of their lives. As a pension sharing order would have reduced the overall income available, and divorce would have involved the loss of a fairly significant widow’s pension, the solution involved ongoing periodical payments and retaining the widow’s pension, in case the non-pensioner spouse survived the pensioner.
She says taking expert advice is usually necessary, as some pension scheme rules mean a widow's pension ceases to be payable on separation as opposed to decree absolute.
Second or third marriages
Of course, not all those divorcing over 50 will be doing so after a long marriage. Some may have married late and come into a second or third marriage with their own resources which they are keen to preserve for their children or grandchildren.
In those circumstances a solution needs to be found to meet both parties' concerns. For example, the partner with limited assets of their own may seek security in the form of a home and financial support for life; while the other will want to ensure their assets do not pass out of the family.
A solution may therefore be for the husband or wife to have a home for their lifetime, which on their death would pass to the former spouse or their estate.
Happy ever after?
Divorce is rarely easy at any age and for those who have been married for 20 or 30 years, this life changing event may have even more of an impact.
Optimistically however, Sue says that in all her years as a divorce lawyer, she has never had a client tell her, years later, that they wished they hadn't divorced.
“All those I have spoken to afterwards were happy in their new life and that can happen at any age. For my client in his 90s, separation enabled him to be reunited with his children and grandchildren and to travel the world,” she concluded.
“It might be a scary time, but with the right support and tailored advice, you can move forward and enjoy life on your own terms.”