The Toronto Star reported that according to Statistics Canada, “grey divorce” has been steadily growing among those 55 and over, with rates expected to increase as people continue to age. In its latest batch of 2011 census data released last year, while marriage remains the predominant family structure in Canada, it only represents 67 percent of Canadian families, down from 70.5 percent a decade ago. As baby boomers reach the retirement age, divorces among couples aged 65 and above are becoming more and more common. In 2008, there were 1,237 divorces among women 65 and older, 2,486 among men of that age, and 852 divorces where both partners were over the age of 65, StatsCan’s figures show.
It’s no longer news that many boomers are delaying their retirement due to a poor return on their financial investment and their ‘boomerang’ kids still relying on their support. Now, there’s another reason for continuing to stay in the workforce – divorce past 50 leads to inadequate retirement funds.
According to new research from Investors Group, 80 percent of “grey divorcees” (defined in this research as people who divorced at the age of 50 or older) say they will delay their retirement because they need to work longer than planned and more than half (62 percent) say their post-divorce savings and investments will no longer be adequate to fund their retirement.
The research indicated that 54 percent of those who divorced at past the age of 50 found it difficult to make financial decisions surrounding their divorce and when it came to organizing their finances post-divorce or separation, almost one-third (31 percent) found this task overwhelming.
Fifty-three percent of respondents say they have had to adjust their retirement plans and within this group, 55 percent say that their plans completely changed. Almost half (47 percent) say they will have to scale back on their anticipated retirement lifestyle.
Not surprisingly, the more bitter the divorce, the bigger the financial challenges become. More than a third (35 percent) of respondents say they would classify their divorce as bitter. Eighty percent of this group say they found it difficult to make financial decisions surrounding their divorce.
When it comes to gender differences on parting ways, unfortunately females were 10 percent more likely than males to say making financial decisions were difficult – 59 percent versus 49 percent. While 40 percent of men found the division of assets caused the most significant financial stress, 60 percent of female divorcees ranked managing living expenses on their own as the biggest financial difficulty compared to only 34 percent of men.
Unhappy marriages and divorces are always difficult for people of all ages. But just when you think you can live happily ever after in sickness or in health into your sunset years, relationship crises can happen even when you’re aging and divorces for boomer couples can be both financially and emotionally draining. I’ve always maintained that women should be financially independent whether they are happily married or not. If they are not dependent on their spouse during happy times, they should be able to keep their heads above water should they decide to part ways.