The Financial Consequences of ‘Gray’ Divorce

Divorce after 50 can dramatically reshape your retirement, making careful financial planning more important than ever.

Gray divorce is becoming more common, and its financial impact can last well into retirement. New Africa/shutterstock

Gray divorce refers to divorce among adults ages 50 and over. And although divorce among younger adults has been declining over the past 15 years, according to Pew Research, gray divorce is on the rise.

Although any divorce can be financially difficult, gray divorce is especially hard on retirement because it halves accumulated savings. It can also double living expenses by creating two separate households. The danger of a gray divorce is that, unlike a divorce in your 30s where you have time to make up for the financial loss, there is little time left in your 50s or 60s to rebuild wealth.

Prevalence of Gray Divorce

According to a study published in The Journals of Gerontology by Susan L. Brown, the gray divorce rate was low and grew only modestly between 1970 and 1990 before doubling by 2010.

The study found that, although the divorce rate has stagnated among middle-aged adults, it continues to climb among older adults.

In 2022, 36 percent of U.S. adults who divorced were aged 50 or older. The only group with an increasing divorce rate was found to be adults aged 65 and older.

According to Barnes Family Law, divorce among couples 65 and older has tripled since 1990 and is expected to grow by another one-third by 2030.

Financial Fallout From Gray Divorce

The longer the marriage, the more assets you share with your spouse. Finances are intermingled. And now, depending on your state’s laws, retirement savings, homes, and other assets will need to be split. Both men and women experience roughly a 50 percent drop in wealth, according to a 2022 study published in Innovation in Aging titled “The Economic Consequences of Gray Divorce for Women and Men.”

The study also found that women experienced a 45 percent decline in their standard of living, whereas men’s standard of living dropped by 21 percent.

Beyond just splitting assets, the cost of divorce because of legal proceedings can affect your monthly budget or retirement plans.

According to The Law Offices of David M. Moore, the average divorce in the United States costs between $15,000 and $20,000. But this figure can actually run from a few hundred dollars for an amicable divorce to over $100,000 in a high-conflict high-asset divorce.

Dividing Assets Over 50

If you and your spouse can’t agree on how to divide assets, a judge will decide following the law of the state.

Most judges use a system called equitable distribution, splitting all assets, earnings, debts, and property as they deem fair, according to Edelman Financial Engines. The length of marriage may also be a consideration. However, nine states follow community property laws. In these states, community property is typically divided 50–50, and each spouse keeps his or her separate property.

Retirement Accounts Divided Through QDRO

According to The Pension Rights Center, retirement plans like 401(k) plans, 403(b) plans, and pension plans typically must be divided through a qualified domestic relations order (QDRO).

A QDRO is a legal instrument that grants a person the right to a portion of the retirement benefits that person’s former spouse has earned through a private sector employer-sponsored retirement plan.

Without a QDRO to divide these benefits, people going through divorce may lose their rights to a share of those benefits and put themselves at risk for financial insecurity at retirement.

It’s important to hire an attorney who understands that retirement assets are at stake and that a QDRO is needed.

The court must be notified to ensure the former spouse provides all the information the court needs.

According to the IRS, most plans require you to file a QDRO with the plan administrator before the plan can pay any portion of a participant’s retirement benefits to an ex-spouse.

Life Insurance for Dependents and Alimony

Life insurance may also be subject to division in a divorce. This is especially true if there is a cash value since this may be considered a marital asset.

According to Edelman Financial Engines, many divorce settlements require holding life insurance to protect child support and alimony payments.

Regardless, ensure you update your beneficiary for all life insurance policies.

Post-Divorce Retirement Planning

It’s important to prepare a financial plan and budget to help guide you through your divorce. You’ll want to review monthly bank and financial statements and make copies for your attorney.

Taxes are often overlooked. Ensure you consult an accountant or tax attorney. If you are paying or receiving alimony, discuss this with an accountant. According to Intuit Turbotax, when you started collecting alimony determines any taxation.

According to the Social Security Administration, if you’ve been married more than 10 years and have divorced, you’re generally entitled to half of your spouse’s Social Security, provided the benefit is greater than what you qualify for. You must be 62 or older, and if you file before your full retirement age, you’ll receive a reduced Social Security benefit.

The Epoch Times copyright © 2026. The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. The Epoch Times holds no liability for the accuracy or timeliness of the information provided.