Life is What Happens…While You’re Making Other Plans

Laurie MacNaughton [506562] ©2016

The gentleman on the phone said, “Honestly, we’ve been in a bad way for a while; it’s just finally come to this.”

After 52 years of marriage the “this” Martin and Bettie (not their real names) are referring to may come as something of a surprise. It’s a later-in-life divorce.

Martin is willing to stay the course – despite the fact the course has been bumpy for years.

Bettie, however, at age 73 doesn’t want to continue on for another potential 20 years.

This is not just one isolated case: according to the National Institute on Aging, while divorce rates in the general population have fallen, divorce among couples aged 62 and older occurs at a higher percentage than in any other age group.

Issues in a divorce later in life quickly reveal a difficult intersection between elder law and family law. For instance, when both spouses are living on Social Security and have few assets other than the marital home, how does the spouse remaining in the home pay the departing spouse’s portion of the marital share?

For some older divorcing couples, selling the marital home may make the most sense. But if one spouse is intent upon remaining in the home, one way to accomplish this can be by means of a reverse mortgage.

Couples married many years often have equity enough in the home for the proceeds from a reverse mortgage to pay the departing spouse’s portion of the marital share. Alternatively, reverse mortgage proceeds, plus an additional cash payment to the departing spouse, may make retention of the home possible, without the spouse remaining in the home draining retirement savings or picking up a monthly mortgage payment.

A reverse mortgage will not work in every “silver divorce.” But in many divorces involving homeowners in which at least one party is aged 62 or older, it’s one of the few ways a Property Settlement Agreement’s financial mandates can be met without forcing sale of the home, depleting financial reserves, or acquiring a monthly mortgage payment in the retirement years.

Divorce is no one’s “Plan A.” But as the classic line goes, life is what happens while you’re busy making other plans.

Give me a call and let’s talk. I always love hearing from you.