Is a divorce part of your retirement planning?

The divorce rate for people age 50 and older has doubled in the last 20 years. According to an analysis of U.S. Census data by demographers at Bowling Green State University in Ohio, among people older than age 50 in 2009, about 25 percent were divorced, up from 10 percent in 1990.

If you are determined to divorce just before you take retirement, it pays to be pragmatic about alimony and Social Security, says family law attorney Jennifer Weisberg Millner, a partner at Fox Rothschild’s Princeton, N.J., office.

Millner recently analyzed a case decided in the Superior Court of New Jersey, sharing it with her clients. The court said in Smith v. Smith that alimony would continue even though the the 71-year-old ex-husband, the defendant in the case, had lost his job as a truck driver because of a physical condition that prevented him from renewing his driver’s license. The court reasoned that after 40 years of marriage, any income — including Social Security — should be split. While the 70-year-old ex-wife continued to work part-time, the court didn’t count that income because it said she should be allowed to retire since her ex-husband was already retired.

Millner says that decisions like this one shouldn’t be viewed as setting a precedent because they are usually decided based on the very specific facts of the case. That said, she warns alimony doesn’t automatically end at retirement. “You have to think seriously about alimony in retirement. I’ve had plenty of clients who have paid alimony past retirement. It happens.”

For many people, the best approach, she suggests, is to work out a strategy and include it in the divorce agreement that takes the Social Security full retirement age of the primary breadwinner into account. Often, that gives both halves of the couple the most flexibility in claiming Social Security, which is a significant part of most people’s retirement income.

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