Libertyville Divorce Blog

Even as overall divorce rates decline in the United States, "gray divorce" is growing more common in Illinois and across the country. For Americans aged 50 and up, the divorce rate has more than doubled in the 20 years between 1990 and 2010, a trend that shows no sign of stopping. There are a number of reasons why more older Americans are choosing to end their marriages, but there are also some specific concerns that can accompany this type of separation. Because a divorce tends to have a major financial impact on both parties, people considering a divorce later in life may want to consider their retirement plans.

One contributing factor to the rising popularity of divorce among older adults is increased health and lifespan. People are living longer lives and remaining healthy longer, and they want to live out their lives happily. In addition, some parents stay together in order to raise their children in the same home. After their children are adults and out of the home, they may finally make the decision to divorce. Social responses to divorce have also changed dramatically in recent decades; ending a marriage has become much more widely acceptable and common than in the past.

It isn't uncommon for Illinois residents and others to turn to their IRAs or 401(k) balances to help pay for costs related to their divorces. However, individuals may be diluting the value of their accounts by accessing them before the age of 59½. This is because the government will assess a 10% early withdrawal fee for doing so. Furthermore, those who take money out of their retirement accounts will need to pay income taxes on the amount withdrawn.

Instead of withdrawing money from a 401(k), it may be possible to borrow money instead. Individuals may be entitled to borrow an amount equivalent to 50% of their current account balance up to $50,000. Loans are typically repaid on a monthly schedule, and interest rates are typically the prime rate plus 1%. A person usually has five years to repay the entire loan balance.

Do you think that there is no way to avoid spending a fortune on your divorce? Feel as if you have no other option than to fight your ex tooth and nail over every lamp or area rug? Think again. These days, some former couples making their way through divorce find that they can do all the things that they need to do to move forward with their separate lives without having to go through litigation.

Instead, many former couples opt for divorce mediation, which involves both parties coming together with an unbiased third party to work through matters to end the marriage. While mediation may not work in all circumstances, if your split is at least relatively amicable, it may serve you both well to consider it. Why? Compared with a courtroom divorce, divorce mediation offers several notable benefits, such as:

Since 1990, the divorce rate for couples 50 and older has doubled. Divorces can have both a financial and emotional impact on Illinois residents and others who go through them. Research has shown that those who have ended their marriage may be at a greater risk of higher blood pressure or excessive weight gain. Individuals who get a divorce later in life can see a decline in both their net worth and their standard of living.

Those who get divorced after the age of 50 will see their net worth drop by about 50%. Women will see their standard of living decrease by 45% while men will see their standard of living drop by 21%. Furthermore, most who get divorced later in life don't see any type of financial improvement in the years following the end of their marriages. For women, this is partially because it can be harder to find a job after spending years raising a child.