Ending a relationship, whether cohabitation, civil partnership or marriage, is difficult at any age. However, when you are past retirement age, it can be even more tricky to come to terms with a split. You are probably expecting to spend your days with your life partner. You may have made plans for this time, perhaps to travel or even live abroad, move to the countryside or spend time together with family. Not only do you have the normal emotional issues to deal with, but you also have to separate what are often complex finances.
What are Silver Splitters?
According to The Guardian they are “Britain’s hottest new demographic”. If you are over 60 and going through or have recently gone through a divorce, you would fall into this group. In the decade between 2005 and 2015, men divorcing age 65 and over increased by 23% and for women, it was a massive 38%. The issue was highlighted again recently with the high-profile divorce of Bill and Melinda Gates.
Why are these numbers on the increase?
Often couples wait until their children are financially independent, have left home or are at least adults. As couples are choosing to have children later in life, this often coincides with retirement age. There are also couples on their second, or even third marriages, who feel the relationship is at an end. Whilst waiting for the children to be self-sufficient avoids the issues of child maintenance, who the children live with and when, it does mean there is less opportunity to rebuild the finances after the separation.
The Big Issues
The House – Both parties need somewhere to live. They will be used to being homeowners and be keen to retain that status. However, it may be that there just isn’t sufficient in the budget to buy them each a house or flat, in the area they want to live.
Income – In retirement, pensions will be likely to already be in payment, which can make them more difficult to value and share. Consideration should also be given to the state pension. Where younger divorcees have the opportunity to return to work, increase their hours, etc. It is unlikely that someone already retired wants to return to the rat race.
Financial Education – If you’ve never looked after the money in your relationship and you split up in your forties, after a 20-year marriage, that’s hard but in your 60s or 70s after a 40-year marriage, it can be almost impossible. You need help and support to understand how to look after your money, pay bills, save for bigger things you need. It is a good idea to put together a spending plan and try to stick to it.
Needs and Separation
Financial settlements are worked out on a needs or separation basis. For divorcees post retirement, where there are limited financial resources, it is vital to ensure that all their needs are considered. The expenditure section should have time taken to complete to ensure all items are included.
It should also be understood that the resources available need to meet the needs of both people. Therefore, there may not be sufficient to live the lifestyle that you are used to. It was quoted in The Guardian that Silver Splitters are responsible for an increase in renters. Whilst many of us would like our children to inherit our house, it may not be possible to buy two new homes and so renting might well be the best option. However, it should be carefully considered so that you don’t run out of money with no assets to draw on.
Working with a financial planner can help with all of these areas, providing clarity and peace of mind. I would suggest speaking to a divorce specialist, preferably Resolution accredited, so that you know they have been tested at a high level of technical ability in this area.
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