Divorce later in life, often termed “grey divorce,” is becoming increasingly common. Particularly among baby boomers and older Gen X couples, who after more than 20 years of marriage, are deciding to part ways due to evolving as individuals, becoming empty nesters, or desiring to live life on their own terms in their remaining years.
These unique characteristics of grey divorce, such as being retired or near retirement and facing complicated asset division, present distinct challenges and considerations. If you’re facing this challenging transition, understanding the unique aspects of grey divorce is crucial.
At Lotus Legal, we provide compassionate family law services to guide you through this difficult time.
What is Grey Divorce?
Grey divorce refers to the dissolution of marriage among older adults, typically those in long lasting marriages, aged 50 and above. This trend often involves couples calling it quits after decades of commitment, highlighting a significant shift in the dynamics of marital stability. The term also includes de facto separations under the Family Law Act 1975 (Cth), applicable to couples who have lived together but never married.
“Grey divorce” has gained popularity as the rate of separation among older couples, particularly those exiting long-lasting marriages, continues to rise.
Key Considerations in Grey Divorce
1. Seeking Family Lawyer Advice
The first step in navigating a grey divorce is consulting with an experienced family lawyer. Legal professionals can help you understand and manage the two main components of separation: the divorce application and the property settlement. It’s essential to seek legal advice early to ensure you are informed about your rights and options.
Getting in Touch
For compassionate and professional guidance, contact Lotus Legal. Our team is dedicated to providing the support and expertise you need during this transition. We understand the emotional and financial complexities involved in grey divorce and are here to help you navigate this difficult time.
2. Dividing Retirement Benefits and Superannuation
In Australia, the division of property at ‘retirement age’, including superannuation, is governed by the Family Law Act 1975 (Cth). This stage of life brings unique challenges, especially when dividing ‘retirement benefits’ such as superannuation interests, which can be split, and may also be subject to valuation and flagging orders to protect your financial interests.
The impact of grey divorce on retirement benefits, including spousal maintenance, division of assets, and financial literacy, is significant. Retirement savings, which often represent a substantial portion of a couple’s assets, along with other retirement benefits like savings, social security, pensions, and life insurance, are crucial in ensuring financial stability post-divorce.
Superannuation Splitting
Superannuation splitting orders can ensure that both parties receive a fair share of retirement savings. The process involves valuing superannuation interests, which can be complex, especially with defined benefit schemes. Accurate valuation is crucial to achieve a fair division of assets.
Immediate Actions
In some cases, urgent actions such as flagging orders or injunctions may be necessary to protect superannuation interests and other assets. These legal measures can prevent the dissipation of assets and ensure that both parties’ financial interests are safeguarded during the divorce process.
3. Financial Agreements and Court Orders
To finalise property matters, you might consider a Financial Agreement (postnuptial agreement) or seek Court Orders. These decisions require tailored legal advice to ensure they suit your unique situation. A Financial Agreement can provide clarity and security by outlining how assets and liabilities will be divided.
Financial Agreements
A financial agreement, sometimes referred to as a postnuptial agreement, is a legally binding document that specifies how assets and liabilities will be divided in the event of a separation. These agreements can be particularly beneficial in grey divorce cases, as they provide certainty and can help avoid lengthy court disputes.
Court Orders
If an agreement cannot be reached through negotiation, it may be necessary to seek Court Orders. These orders can be made by consent if both parties agree on the terms or by the Family Court if an agreement cannot be reached. Court Orders provide a legal resolution to property and financial disputes, ensuring that both parties’ interests are considered.
Practical Tip
Prepare for your initial consultation by listing all known property and financial resources, including real estate, superannuation accounts, retirement plans, and bank accounts. This information will assist your lawyer in providing accurate advice and developing a comprehensive strategy for your case.
4. Managing Interim Income and Living Costs
Separation can disrupt your income streams and living arrangements. Consider interim relief options, such as agreements or Court Orders for spousal maintenance, to cover expenses until a final settlement is reached. Managing finances during a grey divorce can be challenging, especially if one spouse has retired or is financially dependent on the other.
Interim Relief
Interim relief measures, such as spousal maintenance orders, can provide temporary financial support to ensure that both parties can maintain a reasonable standard of living during the divorce process. These orders can cover essential expenses, including mortgage payments, utilities, and insurance.
Spousal Maintenance
Spousal maintenance is a complex area of family law that requires careful consideration of each party’s financial needs and resources. Choosing a family lawyer can help you understand your entitlements and obligations regarding spousal maintenance, ensuring that your financial interests are protected.
Additional Professional Advice
Apart from legal support, you may need advice from other professionals, such as financial planners for managing assets and entitlements, or health professionals for emotional support. Grey divorce can have far-reaching implications on various aspects of your life, and seeking comprehensive advice is essential.
It’s also important to consider the complexities of entering into a de facto relationship or dealing with the financial and emotional aftermath of previous relationships, especially when it comes to protecting assets accumulated earlier and ensuring the well-being of children from those relationships.
Financial Planning
A qualified financial planner can help you understand the financial impact of divorce and develop a strategy to manage your assets and income. They can provide guidance on budgeting, investment planning, and managing retirement savings.
Estate Planning with Adult Children Considerations
After a grey divorce, it’s important to review and update your estate planning documents, including your will, power of attorney, and superannuation nominations. These updates ensure that your wishes are clearly articulated and legally binding.
Emotional Support
Divorce can be emotionally taxing, especially after a long-term marriage. Seeking support from mental health professionals, such as counsellors or therapists, can help you navigate the emotional challenges and build resilience for the future.
Speak to Lotus Legal
Separating later in life is a significant event that requires careful consideration and expert guidance. At Lotus Legal, we understand the emotional and practical challenges of grey divorce. Our compassionate family law services are here to help you navigate this journey with confidence.
For personalised legal advice and support, reach out to Lotus Legal. Our team is ready to assist you through every step of your grey divorce process. We offer a compassionate, supportive, and professional approach to ensure that you are well-informed and prepared for the next chapter of your life.