The changes that take place during and after a divorce can be far-reaching. Many lives change in an instant during a divorce. One area that is sure to change is a person’s financial standing or outlook. For couples who are going through what is dubbed a “gray divorce,” which is divorce after the age of 50, the impact a Pennsylvania divorce may have on retirement savings can be life-altering.
Retirement savings accumulated over time may be significant. If one party stayed at home and the other made the bulk of the retirement savings or pensions, those funds would be split between the two. The division of retirement funds can essentially mean that both parties may be retiring on half of what they expected to have. Plus, after a certain age, it may be difficult if not impossible to rebuild that nest egg.
Retirement savings that need to be addressed during a divorce may include much more than a savings account or a pension fund. There may be stocks or bonds that are set aside for retirement also. Pensions from previous jobs may also be out there and in need of accountability.
Whenever there are significant retirement accounts to consider as part of property division during a divorce, it may be necessary to find professional help for locating and accounting all funds. It may be difficult for a primary earner to basically give up half a nest egg, but it may be exactly what that spouse needs to plan for. Anyone dealing with a divorce in Pennsylvania may want to account for all assets and understand the tax implications and life-long implications of property division and asset division, particularly during a “gray divorce.”
Source: nytimes.com, “Retirement Plans Thrown Into Disarray by a Divorce“, Constance Gustke, June 27, 2014
