‘Gray divorce’ for Gen X and Boomers is skyrocketing: 5 money mistakes to avoid before they derail your retirement

In addition to the emotional stress of “gray divorce”, managing your money is very important.

The first step is to employ an experienced divorce lawyer. Although it may be tempting to avoid legal fees, going without professional instructions may cost you more in the long run. In addition, understanding the main financial and tax issues that come with gray divorce is essential.

1) How to budget after divorce

The cash flow that you have during your marriage support for one family. After the divorce, the available income stream will need to fund the two families. At best, you can expect to cut your income in half.

Grant, you just have to cover your personal expenses, but some expenses, such as housing, insurance and medical expenses, can exceed 50 % of married couples.

Start by calculating the spending budget. To start, detail your fixed costs: things such as rent, car payments, insurance, groceries, and facilities. Your variable expenses, such as travel, restaurants and gifts, can be modified, based on your available income.

Since your divorce lifestyle becomes more confident, you can review this budget.

2) Selling the house and reducing its size after divorce

After late divorce, you may think that you want to keep the family at home. This can be a sword of two borders. Keeping all stocks at home means that you will get less than other assets.

Also, the cost of maintaining a large house along with the assumption that the mortgage can press your budget. Do you really want to be poor home to keep a stay that may be very large for you?

3) The benefits of social security divorce

If you are married for at least 10 years, your social security feature will be greater than your own interest or half of your previous wife’s advantage. Certainly, if this makes a difference for you, think about the timing of your gray divorce. For example, if you have been married nine and a half years ago, you may want to delay the final decree for a period of six months.

In addition, if you are approaching the age of 62 (or greater), you have an early entitlement option for less than a continuous monthly benefit or delay to increase your monthly interest. Your personal financial position and the life expected age will be the basic decisions.

4) Work after divorce

If you are to be shortened in cash flow, return to work (or persistent) may be a good solution. Depending on your deficiency, it may not be necessary to keep a full -time high -time function.

Many distinguished people complete their income through alternative teaching, homes and dogs, and other part -time work.

Whether you follow your usual job or follow something less required, there is a great advantage for bringing in income: you may be able to delay your investments.

5) Securing long -term care after divorce

When you are alone, the coverage of long -term care is important. This insurance will be less expensive and easier when you are younger (less than 60 years) and healthy. If you are not able to withstand installments, think about choosing a waiting period longer than 180 or 360 days. Long -term care for six months to a year can be dealt with more easily than having to cover care for many years.

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There are two other options to cover long -term care costs. First, I have been able to exchange a life insurance policy for the long -term care policy. Second, consider moving to the retirement community “continuous care”. You can choose an independent living, which resembles your own apartment. As you get older and require more care, you can move to living facilities, healthcare or health care within society.

This article was provided to the Associated Press from Mooringstar. For more personal financing content, go to >

This story was originally shown on Fortune.com

2025-04-08 17:55:00