Unfortunately, gray divorces, which are divorces involving people who are over the age of 50, are becoming more common in the US. Pew research indicates that the rate of gray divorces has doubled since 1990. Divorce is likely an emotional experience for the people involved, and if you’re a Washington resident, here are some things you should know about your gray divorce that will make the process as efficient as possible.
Working with a financial advisor
It is common for people to depend on their divorce attorneys for advice on how to get through the process. While an experienced lawyer is essential, it is also ideal for both parties to consult with a Certified Divorce Financial Analyst (CFDA). Financial professionals who have extensive experience with divorce cases can be beneficial to individuals involved in a gray divorce. Usually, older individuals have more to lose financially when going through a divorce, and an advisor can make the process more affordable.
Consider tax laws when dividing your assets
The Tax Cuts and Jobs Act was enforced in 2018 and brought about significant changes concerning alimony payments. If a couple finalizes their divorce after December 31, 2018, the person paying alimony will not receive a tax deduction for the payments. The party receiving the alimony payments is also no longer obligated to pay taxes on the funds.
Make changes to your estate plan
You should consider your retirement plans and life insurance policies when getting a divorce as well. When it comes to pension plans, your spouse is automatically your first beneficiary. If you want your minor or adult children to be primary beneficiaries on your insurance accounts, make an appointment to do this as soon as you can. This will increase the chances that your funds are distributed according to your specifications once the divorce is final.