All of the work Pennsylvania married couples put into planning for their retirement can unravel when they go through a divorce. A property division order could force the sale of their home as well as the liquidation of other assets that might have been key elements in the retirement planning for each of the parties. There are, however, steps people can take to lessen the damage or hasten their recovery from it.
The financial and lifestyle changes divorce legal issues impose on the parties can be particularly damaging when the marital dispute occurs later in life. For example, the home a couple planned to remain in during their retirement years might be too expensive to keep when two incomes become just one. Selling the marital home as part of the divorce settlement frees up money that can be invested to generate retirement income or to build a retirement nest egg. The money saved by downsizing and reducing monthly housing costs could be invested in a 401 (k) at work or in an IRA account.
Negotiations to reach a property division settlement related to a marital dispute might not be focused on the retirement implications associated with the end of a marriage. Young couples have time to rebuild and recover from the financial impact, but older couples at or close to retirement might not have that luxury. The emotions associated with a divorce can become a distraction that places the emphasis on current issues, such as spousal support and property division, without enough attention being paid to long-range financial goals.
Individuals going through a divorce later in life need to think in terms of settling divorce legal issues while keeping retirement goals in mind. Such individuals might benefit from the advice and counsel of both a family law attorney and a financial planner.