The Gray Divorce: The Growing Risk of Divorce Among Baby Boomers and Why It’s Important
Larry King is yet again getting divorced. While the news of Mr. King’s divorce should come as no surprise (this is his eighth, after all), the longevity of his eighth marriage (22 years) and the respective ages of he and his wife (85 and 59) underscore the rapid rise of divorce among Americans 50 years of age and older–a phenomenon coined, The Gray Divorce.
Despite the decline in divorce rates overall, divorce rates amongst those 50 years of age and older has doubled, and has tripled for couples 65 years of age and older. For me, this is a personal issue. At the time of their divorce, my parents were married for 32 years and dated for 6 years prior to that time. My brother was 24 years old and serving in the Peace Corp overseas. I was finishing my last semester in college abroad in Spain. Although my mother was highly educated with a master’s degree, she had been a stay-at-home mom and out of the workforce for more than 20 years, and nearing 50 years old. My father had his own lucrative CPA practice making more than $400,000 per year. Like many other baby boomer couples, my father controlled the finances. My mother initially discovered that my father wanted a divorce when she confronted him about a charge for an apartment some 10 miles from the parties’ marital residence. When she approached my father about the charge, he informed her that he wanted a divorce and would be moving out of the home. He also told her that if she did not get angry, then he would be “more than fair.”
As a board-certified family law lawyer, the term “fair” (what I like to call the “forbidden F-Word” in Texas family law) is one that I tend to avoid in discussions with my clients regardless of their age, but particularly with my gray divorce clientele. Absent significant assets, fairness is something rarely experienced by those facing the trauma of a gray divorce, at least in Texas. Take my mother, for example. After paying for years of private school tuition, elite and club soccer dues, equipment, and travel expenses, cars for my brother and me, and college tuition, my parents’ estate consisted mostly of their marital residence (which, of course, had a mortgage) and my father’s CPA practice. Much to my mother’s dismay, the value of my father’s CPA practice would be greatly discounted for personal goodwill (the value attributable to my father’s efforts and services as an individual CPA), an asset that is simply not divisible in Texas. Coupled with the fact that there is no alimony in the state of Texas, her post-divorce financial future was bleak.
This article is not intended to pass judgment on the decisions of either my father or mother made during the divorce process. Rather, I hope that their/my story will serve as a backdrop to shed light on the unique issues presented by the gray divorce phenomenon, the pitfalls to avoid, and the financial, emotional and psychological consequences that can often result when getting divorced later in life.
The Statistics: Numbers Don’t Lie
Although the divorce rate for those 50 and over is still half the rate of those under 50, the rate of these so-called baby boomer divorces has risen much more dramatically for gray Americans than for those under the age of 50. According to a report issued by the Pew Research Center, the divorce rate among adults 50 years or older has roughly doubled since the 1990s. The majority of gray divorces are those who have been married less than ten years. However, there is still a significant share of gray divorces among adults who have been married more than thirty years. Numerous researchers have speculated as to the cause of this increase, but it is difficult to pinpoint the main contributing cause. A family lawyer from New York once crassly speculated that sex was a huge contributing factor, with men over the age of 50 using Viagra and thus more capable of satisfying younger women. Some researchers have pointed to other factors including increased life expectancy, financial autonomy for women who work compared to previous generations, changing priorities, empty-nest syndrome, or simply growing apart from one another. Whatever the reasons, given that baby boomers (at least for now) constitute the largest living adult generation in America, the rapid rise in divorce in this age group is alarming and a great cause for concern.
The Ghost of Marital Past
“Those who do not learn history are doomed to repeat it.” While this adage has been used (likely overused) by countless history professors and philosophers in exploring the history of the world, the same is an apt description of the gray divorce phenomenon.
Per a recent study, couples over the age of 50 who have been divorced are 2.5 times more likely to divorce than couples who have been married once. Roughly 50 percent of those divorcing couples are in remarriages. My father is one of these statistics. But, why does all of this matter?
Divorce at a more advanced age greatly increases the risk of poverty. According to Susan L. Brown and I-Fen Lin, sociologists at Bowling Green State University, older divorced couples have only 20 percent as much wealth as older married couples. Divorce also tends to have a greater impact on older women in particular. Divorced women 65 and older are 80 percent more likely to be impoverished than their male counterparts. Couple these statistics with the rate of divorce amongst remarried couples and the financial outlook for those individuals looks pretty grim.
Given these alarming statistics, divorced individuals who are contemplating marriage again should strongly consider entering into a premarital agreement with his or her soon-to-be spouse. Such agreements simply clarify your and your soon-to-be spouse’s financial rights and obligations and offer protection against protracted litigation in the event of divorce. While “prenup” has long been considered a dirty word and forbidden topic amongst couples, a “prenup” (or premarital agreement) is nothing more than an insurance policy designed to protect you and your spouse against the worst-case scenario—the dissolution of your marriage and the financial instability that often results.
Financial Stability Now and In the Future
Getting divorced is never easy; however, a gray divorce is starkly different from a divorce in your twenties and thirties where the parties have countless years ahead to work and save for their future. Older adults need a significantly greater share of the household income and resources. Per a 2014 report from the Government Accountability Office to the Senate Special Committee on Aging, a single person 65 or older needs 79 percent of the income of a two-person household (which would explain the uptick in couples getting divorced to collect more social security). Thus, financial planning and strategizing in a gray divorce is key.
When dividing assets and debts, each party must ask himself or herself, Can I support myself today and more importantly, the rest of my life? This is particularly true for individuals on the brink of retirement or those who have worked solely in the home and have not been in the workforce for many years. Thus, it is important to not only look at today’s value but also the potential growth, security and/or tax incentives of each piece of property or debt to be divided.
While it is important to ensure that you have liquidity (assets that can be immediately accessed and used), it is equally as important to have assets which have long-term payout and growth potential. Finding the right mix of assets to best suit your needs is a form of art and must be analyzed on a case-by-case basis to determine what fits your short-term and long-terms needs. A spouse may walk away with more than enough assets to live on for the entirety of their life, but poor financial decisions can change that very quickly. If a spouse has not managed money, investments or has never paid a bill in their adult life, it is imperative that they seek advice from a financial advisor. A financial advisor can help ensure that what you receive in a divorce is spent wisely and invested properly so that you have financial stability moving forward.
Fortunately, financial planning and assistance is not exclusive to the “haves” and “have-a lots.” My mother is a prime example. Despite her pittance of a divorce settlement, my mother invested wisely and sought the assistance of a financial advisor to whom she had been referred by her church. The financial planner helped her figure out a budget and the amount of cashflow she would need in a given month to supplement any income she earned following her divorce. He also encouraged her to place a significant sum of her money in a Certificate of Deposit (CD). Despite her skepticism, my mother heeded his advice. As a result, the CD grew roughly 30 percent over the five years the money was on deposit and provided my mother with financial security in the future that she would not have had otherwise.
A Social Contagion
To most, divorce seems to be a matter of personal concern with little to no public consequences. However, according to Rose McDermott of Brown University, the divorce of a friend or a close relative greatly increases the risk of divorce. Specifically, the findings of McDermott’s study suggest that the likelihood of one’s own divorce increases 16 percent if a close friend divorces and becomes 12 percent more likely if a friend of that friend divorces. These contagion statistics are even more alarming when looking at children of divorce.
Research has been consistent in showing that children of divorce are significantly more likely to divorce and have failed marriages. Studies have shown that children of divorce are 50 percent more likely to marry other children of divorce and are 35 percent more likely to experience a divorce of their own. Daughters in particular are negatively affected, with daughters of divorce having a 60 percent higher chance of their marriages ending in divorce.
Unsurprisingly, loneliness is also an epidemic amongst those who fall victim to the gray divorce. Divorce at any age brings about changes in friendships, social circles, and even certain familial relationships. However, the loss of such social connections is even more devastating amongst those 65 or older. Typically, as people age, their social network begins to shrink due to children leaving the home, relocation or death of family members and friends. Thus, the loss of the social connections in a gray divorce can be particularly traumatic, and many lean on their adult children for support and to replace those connections.
Don’t Forget About the Children
I am often confronted in my practice with clients who have waited until their children are in college or have graduated to divorce. Most of these clients subscribe to the misguided notion that their children will be in a better position to handle the divorce as they are older. True, adult children of divorce do not have to navigate custody or visitation arrangements and should be far more mature and independent than a minor child. However, the gray divorce can still have a deep and lifelong impact on adult children, both emotionally and financially–a fact of which I am ever-mindful as an adult child of divorce myself.
My parents finalized their legal battle during my first semester in law school. When my brother committed suicide the following February, neither one of my parents could lean on the other for emotional support. The contentious nature of their legal battle had severed any desire for further communication and therefore I was the de facto messenger and shoulder to cry on. For better or for worse (depending on whose opinion you are soliciting), at 23 years old I was given the task of informing my mother of my brother’s suicide, assisting each of my parents with planning their respective memorial and funeral services, and preparing my eulogy to be given at each.
The impact of their divorce did not end with my brother’s suicide. It pervades nearly every decision that I must make regarding holidays, birthdays, baptisms, or any other event to which typically all family members would be invited. Most significantly, with my father’s deteriorating health, it has left me in a position of being his sole caregiver and manager of his estate—a role that I do not regret nor would change, especially given all that he has done for me throughout my life.
Sadly, my story is one of many experienced by adult children of divorce across the world. Like minor children, adult children must still navigate the logistics of the divorce—where to spend the holidays and birthdays or how often they need to visit with their parents. Parents of adult children tend to lean on their kids more for emotional support, both during and after divorce. Oftentimes, adult children feel as though they have been lied to throughout their childhood about the sanctity of marriage and the idea of family. This can lead to resentment of parents, particularly amongst fathers and daughters where the latter tend to blame the former for the dissolution of the marriage. Many question whether they are responsible for the divorce or whether they want to get married or have children themselves. Others are forced to deal with the reality of unfulfilled financial commitments of their parents—payment of college tuition and expenses, graduate school costs, weddings, or the purchase of a first home.
Further, with aging parents, caregiving is always an issue. But, when parents are divorced, this role often falls exclusively to the adult children and the cost of the same increases significantly—a reality with which I am faced daily.
At KoonsFuller Family Law, we understand that divorce constitutes a traumatic event for our clients and their families and that the collateral damage that can result must not be ignored. For more information about our firm, visit koonsfuller.com.
Special thanks to May Burkett, Associate Attorney at KoonsFuller, P.C., for her contributions to this article.