Preparing for retirement after divorce

On behalf of Gary Kirk of Kirk Montoute Dawson LLP posted in Family Law on Tuesday, February 2, 2016.

As baby boomers age they continue to have a great impact on society. Some of the activities in which this group engages may come as a surprise. For example, members of the demographic are divorcing at a high rate. While working through financial matters tied to a divorce is often difficult for everyone, they can be that much harder for those who are nearing retirement age without the nest egg they thought they would have. Fortunately, there are steps that can be taken to make the transition easier.

One approach is to be more aggressive with saving for retirement. Since the money you most likely thought was there to be used for living expenses, and more extravagant things such as vacations,will need to be divided in the course of the divorce, depending on the specific situation, putting extra money away may be a necessity. Taking the time to reassess your financial situation is an important first step.

Another related issue that should be addressed is the change in beneficiary names on legal documents. It is common for people to place the names of their spouses as beneficiaries on documents such as retirement accounts, pension accounts and insurance policies. When someone divorces, they usually do not want their money to go to the person they spent so much time and money to divorce. Accordingly they should reassess to whom those benefits should go and make the changes.

Divorce encompasses more than just breaking up with a person. Because of this, it is generally beneficial to work with a lawyer who understands both the basics, such as spousal support, as well as the peripheral issues that could arise.

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