What is a Grey Divorce?
According to the PEW Research Center, “Grey Divorce”, or divorce over 50, is becoming increasingly more common. In 2017, the center found that the divorce rate for this population had roughly doubled since the 1990s. For couples who have been married for decades, having to start over later in life also means recalibrating their estate plans. Here are some considerations about grey divorce and your estate plan.
Revising Your Documents
If you have been married to the same person for decades, you may have older estate planning documents such as a will, power of attorney, Advance Health Care Directive, or living will. After the divorce, you need to review these documents with your estate planning attorney and make revisions as needed. If your ex is named as your medical or financial decision maker, you may want to designate someone else. Update your beneficiary information on any life insurance policies or retirement accounts. You want to make sure all of your estate planning documents accurately reflect your wishes and intentions.
Planning for Incapacity
Once you have updated your Advance Health Care Directive, you should also consider how you will provide for your needs if you have a medical issue. Ideally, you will have thought about and planned for this issue during your divorce. Long-term care can cost several thousands of dollars per month. Do you have long-term care insurance? If not, are you able to afford a policy? If the policy is not in your budget, have you considered Medi-Cal planning? Medi-Cal (California Medicaid) pays for long-term care but the program is income sensitive. If you plan of relying on Medi-Cal it’s important to plan for your assets well in advance.
Changes to Inheritance
If you and your ex have children or grandchildren that you planned on leaving part of your marital estate, your divorce could end up changing the plan. When people divorce later in life one or both may end up remarrying partners with children. It can happen that a second spouse ends up inheriting over their partner’s kids or grandkids. During your divorce, you and your ex could agree to terms that protect your loved ones and their inheritance. You could also create an irrevocable trust for their care and maintenance. Another change to consider is that you may no longer be able to afford to provide for your children as you once intended. Divorce can be financially devastating in many situations and can make it much harder for someone to support themselves. For instance, although you and your ex may have wanted to pay for your grandchildren’s private school tuition, you may have to go back on that commitment in view of your new circumstances.
Starting over later in life can be challenging but with the right preparations, your estate plan can get in order. Law Offices of Alice A. Salvo, we are estate attorneys who have experience helping clients find the right solutions. Schedule a consultation today to explore your options and make informed decisions.