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Grey divorce

By Jennifer Samara Shuber

Divorce does not discriminate. It happens in short marriages (the so-called “starter marriage”), in medium length marriages (eight to 20 years) and in long-term marriages (20 plus years) as well. Couples who are very young, middle-aged and older can all be affected.

When parties in their 50s and older separate, the phenomena has been dubbed “grey divorce.” There are special considerations in a so-called grey divorce.

The following are just a few of the reasons why I think parties who are over 50 and considering a separation or divorce should consult with a family law specialist.

Separation and divorce are complicated, whenever you separate. Even more so when you separate later in life. This is due, for example, to the way the law divides property and the information necessary to accomplish the division. Producing documentation to support assets owned on the date of marriage becomes difficult when banks do not save records indefinitely.

Retirement plans are severely impacted by a separation. One spouse may be forced to deplete retirement savings in order to pay out the other spouse. Plans for retirement may have to be delayed. They may no longer be affordable in this new financial landscape where, for example, the income earner is now paying spousal support.

Life insurance becomes an issue. Obtaining and maintaining life insurance is more difficult as parties age. Life insurance may be required to secure support, such that the policyholder no longer has the discretion to name whoever s/he likes as beneficiary of the policy.

The parties’ wills and estate plans are impacted by separation and divorce. For example, devises and bequests to a former spouse are no longer valid once the parties are divorced. What one spouse was prepared to bequeath to the other pre-separation rarely remains the same post-separation. Long-term care plans and powers of attorney need to be re-evaluated. Finally, a separation agreement might limit a spouse’s rights in his/her will, so both documents must be reviewed to ensure they dovetail with each other.

Many older parties have pensions. A pension is considered property for the purposes of property division and equalization. A pension is treated differently depending on whether or not it is in pay when the parties separate. There is CPP and OAP to consider as well. The law around pensions is complex. Parties often require legal advice to understand and resolve pension issues.

Determination of a payor’s income for support purposes can be complicated for individuals who are either further along in their careers or retired. If a payor earns a straight salary, then establishing salary is pretty straightforward. But what about a senior executive with many different kinds of remuneration, including stock options, restricted stock units, executive compensation packages, vehicle and meal allowances, etc.? It is important to understand how the court will determine income.

Older parties have additional financial responsibilities upon marriage breakdown. The spousal support owing might be more than the recipient spouse ever spent during the marriage and more than was budgeted for. Separated parents must pay proportionately for a child’s post-secondary education where there is no such requirement for married spouses. The spouses may not have accounted for same. Similarly, I have never met a party who has put aside funds to cover legal and accounting fees in the event of a divorce. These can add up. All of these financial issues must be factored into a settlement.

Extended health insurance is an issue for older parties. Both spouses may want the coverage to continue, but divorced spouses frequently cannot cover each other on extended health and dental plans. How that coverage is either replaced or accounted for in the settlement is crucial.

If you are considering separation or divorce and the above applies to you, then your best bet is to retain a family law specialist who can consider your particular circumstances and advise you on how best to proceed. It is worth the investment to get it right the first time. Knowing your rights, obligations and entitlements will reduce stress. Learn what the law is and how it will affect you. Knowledge is power.

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