Divorces among Americans over 50, often called “gray divorces,” now account for about 36% of all divorces in the U.S. (1).
For many older couples, what’s at stake when they split can be decades of retirement planning, home equity and shared financial history.
Take Betsy Goldstein. When she began divorce proceedings at 53, she had to deal with years of taxes, retirement accounts and home-ownership paperwork. “I really needed hand-holding,” she told Bloomberg (2).
But it’s about more than dividing assets; it’s about building a solid foundation for the rest of your life.
There are many factors contributing to so-called gray divorces. And it’s not just an emotional shock; the financial devastation from a divorce during this phase of life can have a huge impact.
In Goldstein’s case, she got help from a certified divorce financial analyst, or CDFA. The CDFA helped her build budgets, map expenses and created a plan she could follow. Goldstein had never had to navigate any of it solo before, so having a specialist helped. Five years later, she’s still a client.
Stories like Goldstein’s, and the fact that the divorce rate among people 50 and older has roughly doubled since the 1990s, help explain why the number of CDFAs has jumped about 40% in the U.S. over the last decade, to approximately 3,500 (3, 4).
Research shows just how tough a late-in-life split can be on household finances, especially for women. One analysis of “gray divorce” found that after a breakup at 50 or older, women’s standard of living drops by about 45%, while men see a roughly 21% decline. And unlike younger divorcées, many older adults may never fully recover financially, especially if they don’t remarry (5).
If one spouse stepped away from full-time work to raise kids or take care of family, that time out of the workforce means fewer retirement dollars and smaller Social Security payments. So when the house and pension get divided, the lower earner is often the one struggling to rebuild. (6)
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If you’re over 50 and divorce is looming, there are some financial moves you can make to protect yourself.
To protect yourself and your assets, you need a full picture of your finances. Get a complete view of both joint and individual accounts, including bank accounts, retirement accounts, pensions, property titles, insurance policies and beneficiary designations. And be sure to list all debts (7).
Open separate checking or savings accounts, get a credit card if you don’t have one, ensure you understand how to log in to any online statements and build a small emergency fund. These are critical steps toward independence and building credit.
Retirement accounts, pensions and annuities may be the bulk of your joint wealth, but dividing them incorrectly can trigger taxes, lost income or other long-term consequences. If you can, run through different scenarios (such as keeping the house, splitting accounts and selling and reinvesting) and think about what income you’ll need in the future (8).
If you were married for at least 10 years, you may be eligible to claim Social Security based on your ex-spouse’s earnings rather than your own (9). That can be especially important if your work history or contributions are limited.
Claiming on an ex-spouse’s record doesn’t cut down their benefit. Your benefit is independent, so you’re not “taking” from them; their benefits remain intact. For many gray-divorced people, spousal benefits can make the difference between barely getting by and having a stable retirement income (10).
Many people think of the family home as a safe, comforting anchor after divorce. But owning and maintaining a house on your own, with the taxes, maintenance, utilities and insurance, can be expensive. It might be worth considering renting or downsizing.
A divorce at 50 or older isn’t just a one-time split. It can reshape decades of financial planning. Work out a new budget, build a retirement-ready savings plan and make informed decisions about insurance, healthcare and long-term living costs.
A divorce-savvy financial planner can make a huge difference. They can model different scenarios, explain long-term impacts and help you make informed choices.
Gray divorce has serious financial consequences, especially if you’ve never managed finances on your own. If you’re over 50, whether married or divorced, it’s smart to start getting clarity on your family finances, build your independence and plan for retirement. The earlier you take charge, the better positioned you’ll be if life throws you a curveball.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
National Library of Medicine (1); Bloomberg (2, 4); Pew Research Center (3); The Journals of Gerontology Series B (5); Los Angeles Times (6); Kiplinger (7); US Bank (8); SSA (9); Financial Planning Association (10)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
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