Divorce in Massachusetts has the potential of creating financial implications that can last for years. A new report released from the Center for Retirement Research at Boston College underscores the impact of divorce and explores the long-term financial challenges for retirement planning.
The National Retirement Risk Index was established in 2006. It serves the distinct purpose of measuring the percentage of working households and their capacity to maintain their pre-retirement lifestyle once they’ve exited the workforce. The index estimates that half of American households won’t be able to maintain that same standard of living once they have retired. For divorced households, however, the risk is 7 percentage points greater.
Married couples benefit financially from living in households where they share expenses like property costs and utilities. However, people living alone have to pay for all of their household expenses. Higher expenses with a limited pool of income can impact their ability to plan for retirement.
The phenomenon ‘gray divorce” has been recently surging among the aging populations. From 1990 and 2010, the divorce rate for people age 50 and older has increased by 50 percent. Unfortunately, these separating spouses will have a harder time preparing for retirement. Assets typically lost during the divorce process play a significant role in the individual’s ability to plan for future retirement. To help counteract the challenges, a lower-earning spouse could receive investment assets as part of the settlement.
While ending a relationship may be easy for some, the business of divorce often requires a family law attorney. Divorcing couples can resolve their child custody and other divorce-related matters with an experienced attorney.