For older people, separation and divorce is just as devastating as it is for younger people. Often called ‘silver splitters’, older divorcees usually have more complexity than younger couples, and this is often simply because they’ve been married longer.
Their age and stage of career, can add further complications as they have significantly less time for financial recovery.
Very high incomes and employer benefits including Executive Share Schemes, must be reviewed and considered as part of divorce proceedings, with the view to finding solutions that aim to avoid financial devastation.
While child custody is not usually one of them (as any children are usually adults) Grey Divorce has its own unique issues.
Superannuation must be split and assets divided between parties or sold.
Unfortunately, waiting for favourable market conditions for disposing of assets is rarely possible. Couples with valuable assets are often forced to settle for less, so they may finalise their financial affairs and move on in their lives.
As for the family home, it will likely be sold and both parties required to rehouse themselves and this may include downsizing, if they have the means to do so.
Debt must also be repaid or refinanced should either party take it on.
Unlike younger divorcees, Grey Divorcees usually don’t not have time on their side. Often approaching retirement, they may have little time left in their working life to recover financially. Older women, especially those who have taken a more traditional homemaker role, are particularly vulnerable, as they often have had little, or no opportunity, to accumulate savings or substantial superannuation of their own.
While divorce will always require a legal process that needs to be followed, developing a financial recovery plan that deals with debt, and attends to jointly-owned assets and how they will be applied to each party, is equally important.
For high earning executives, there are likely to be added complications such as executive share schemes and remuneration that includes bonuses which can often include performance-based shares options.
There is often a significant income difference between a high earning executive and their spouse, which will likely require negotiation when dividing assets and superannuation.
Hostile emotions preceding divorce, can often cause decisions to be made that do not favour good outcomes. For grey divorcees, these are almost always related to financial outcomes.
In my experience, there are far less confrontational and less expensive options for divorce than applying to the Court for orders and enduring the process of a contested court case. Applying to the Federal Circuit and Family Court of Australia for orders, should only ever be considered a last resort.
Your next steps
When considering divorce, your first step should be to research your options. Meet with a lawyer who is experienced in separation and divorce and who can clearly explain the process and your options.
Enter your divorce process as a negotiation (with or without lawyers) and exchange documents that will enable your negotiations and the settlement process. I also recommend attending mediation with your partner. Engage an experienced family dispute resolution practitioner or family law mediator. While you lawyer will be able to recommend a mediator, mediation can be with or without lawyers present.
For divorcing executives and business owners, may I also recommend compiling a team of advisers.
Favourable financial outcomes are usually the result of the collaborated advice between your lawyer, accountant or tax specialist and financial adviser. This approach aims to bring together specialist advice in a cohesive strategy that has a goal to determine the best possible outcomes, sooner.
For information about separation and divorce options, please contact Robert Lamb on +61 (0) 7 3007 2080 or email contact@executivestrategies.com.au
Executive Strategies is a specialised information hub for executives and senior managers who may have founded their own business or who work for growing private, ASX listed companies or government businesses. Its purpose is to provide access to specialist advisers and information that addresses the often-complex issues affecting their personal prosperity.
The information in this article is intended only to provide a general overview and has not been prepared with a view to any particular situation or set of circumstances. It is not intended to be comprehensive nor does it constitute legal advice. While we attempt to ensure the information is current and accurate, we do not guarantee its currency and accuracy. You should seek legal or other professional advice before acting or relying on any of the information in this blog as it may not be appropriate for your individual circumstances.
