It takes decades to properly save for retirement. Most people aim to have seven figures in savings, as they will need resources to pay for everything from groceries to housing. Married couples in Washington will often estimate what they need based on their combined needs. They will share a house and all other major costs during retirement.
Those preparing for divorce, especially in their 50s or beyond, will naturally worry that divorce could affect their ability to retire as they planned. Not only will they have to pay for the divorce, but they will need to divide their financial resources. Additionally, retirement savings will now need to support two separate households instead of one combined household.
Will a divorce prevent someone from retiring the way that they planned?
People can rework their retirement plans
Inevitably, divorce will change someone’s financial circumstances. Those changes will likely require a reevaluation of retirement plans. The chances are good that at least a portion of the retirement savings that people have set aside during the marriage will be subject to division.
The community property laws in Washington allow couples to divide any income or resources acquired during the marriage. While the retirement accounts may be in the names of individual spouses, the funds deposited into those accounts were marital income that would be subject to division.
People can act to preserve their retirement savings when planning during a Washington divorce. Each spouse might agree to retain their own retirement savings accounts. One spouse might give up certain other property, like home equity or a vehicle, to preserve as much of their retirement savings as possible. Those who make the preservation of retirement resources a priority can make decisions throughout the process that will help them stay on track for retirement as previously planned.
In some cases, people may need to scale back their retirement plans by reducing their travel or standard of living. Other times, they may be able to replace what goes to their spouse by working a few extra years or maintaining a part-time job for the first few years after retirement.
Ultimately, preparing for the practical implications of a Washington divorce can help people achieve the best possible lifestyle after exiting an unsuccessful marriage.