How divorce can threaten retirement and financial well-being

On Behalf of | Jun 21, 2018 | family law |

Ending a marriage can be an emotional and messy process. If you’ve found yourself on this blog, then you are likely concerned about the ramifications of divorce. In reality, they can be quite extensive, especially when one’s best interests are not fully represented. Although divorce can be emotional, and coming to an agreement or litigating child custody and child support matters can be draining, financial matters like property division usually have some of the most significant impact on one’s life.

One reason is that the timing of property division may not time well with the market for assets that must be sold in order to be divided. For example, if the familial home is sold while the housing market is down, each party may receive less compensation than if the couple had decided to sell the home when the market was hot. Similarly, retirement accounts that are dipped into early may be subject to taxation and penalization if mishandled during marriage dissolution.

Another financial matter that can affect one’s financial health and even threaten his or her retirement is the fact that divorced couples must cover the costs of two households but with the same income. Noncustodial parents may have to pay alimony and child custody, while those who stayed at home during the course of marriage may find it difficult to make ends meet. One recent study even found that women who are custodial parents may have a more difficult time saving for retirement.

Of course, no one should stay in a marriage merely for financial reasons. It is usually wise to carefully consider how to handle a divorce so that one’s financial interests are as fully protected as is possible under the circumstances at hand. A legal advocate who is experienced in family law can help an individual develop a legal strategy, which is one of the many reasons why those considering marriage dissolution should not do so alone.

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