Divorce Near Retirement in Phoenix, Arizona
Couples that divorce near retirement in Arizona have unique concerns. From health and financial needs to the various challenges of aging, divorce for couples who end their marriage later in life can be especially unsettling and challenging. That’s where Cohen Family Law comes in.
Our practice is dedicated to helping families navigate difficult transitions, including divorce. While divorce near retirement may not involve the child custody and child support issues younger divorcing couples need to navigate, tensions brought on by transitioning to retirement while divorcing can impact your ability to plan your financial future.
Trust our legal team to listen to your concerns, explore your options, and design innovative solutions that will allow you to navigate divorce near retirement. Above, all, we will offer you compassion, knowledge, and a superior level of personal service. Please contact our Phoenix office today for a consultation with an experienced Arizona divorce attorney.
How Divorce Impacts Retirement in Arizona
Not only is there an emotional impact of divorce for those who end their marriage later in life; individuals have less time to recover financially as they near retirement. Some of the challenges to consider if you consider divorce later in life include:
Dividing Marital Property
Any divorce in Arizona means that you will be dividing your assets with your spouse, and Arizona is a community property state. A home, in particular, is a valuable asset, particularly later in life, so deciding who gets to keep it can be difficult, if not contentious. Some of the benefits of keeping your house if you divorce near retirement include:
- Real estate property tax exemptions and waivers
- Special treatment of primary residences for individuals seeking public benefits (e.g. Medicaid, SSI)
- Tax benefits (e.g. mortgage interest deductions, exclusions from gains on sale)
- Potential rental income
- Access to home equity
It takes a skilled attorney to explore your options and develop a legal strategy that will protect your interests as you make this difficult transition. In any event, the court must approve agreements regarding the division of marital property before granting a divorce.
Retirement Plans in a Divorce
Dividing retirement plans can be complicated at any age. As you near retirement, however, the value of your 401(k) and other retirement investments may appreciate considerably. Given that retirement plans are marital assets subject to division in an Arizona divorce, it is essential to have the informed representation our firm provides.
If you are entitled to a portion of your soon-to-be ex-spouse’s retirement funds, your lawyer will need to file a court order, known as a Qualified Domestic Relations Order (QDRO).
At Cohen Family Law, we will obtain a copy of the summary plan description and help determine whether you are entitled to contributions or distributions after the divorce. Our divorce attorney will also help you consider factors such as:
- Potential tax liabilities
- Whether there are loans against the 401(k) plan that must be repaid before the assets are divided
- Whether you are entitled to survivor benefits if your spouse dies after the divorce
- Whether you can obtain a hardship withdrawal if you need one
- Your other rights under the plan
Given that a 401(k) or other plans can be a significant asset in a divorce near retirement, working with the right attorney can mean the difference between a difficult later-in-life transition and securing your financial future.
While Social Security benefits are not subject to division in divorce, benefit determinations will weigh heavily in your post-divorce income.
In particular, if the duration of your marriage was 10 or more years and you are age 62 or older, you can collect retirement benefits on your ex-spouse’s work record after divorce (up to 50 percent of your former spouse’s benefit). It is important to note that doing so does not impact his or her benefits.
There are several other considerations related to Social Security that will impact a divorce near retirement, not the least of which is that if your former spouse dies, you may be entitled to survivor benefits. Given that navigating the bureaucracy of the Social Security Administration is daunting, it is wise to consult with an attorney who understands the nexus of divorce and Social Security benefits.
Contact Our Experienced Arizona Divorce Attorneys
If you are considering divorce near retirement, you probably have concerns about protecting your financial future and transitioning to your new lifestyle. Don’t go it alone.
Why not contact Cohen Family Law instead? Principal attorney Mitchell E. Cohen leverages his negotiating skills to guide clients through the mediation process. But our legal team is fully prepared to litigate if necessary.
When you become our client, we will always work in your best interests so that you can divorce near retirement with peace of mind. Please contact our office today to speak with an experienced family law attorney.