Young adults are often told they must work and save with one, final goal in mind — retirement. Most West Virginia workers dutifully contribute to employer-provided retirement savings accounts and some even establish their own. People spend decades of their lives saving for the period of time in which they will be able to sit back and just relax. But what happens when divorce throws a wrench in your retirement plans?
In general, women tend to take a harder financial hit during divorce. A 2008 study found that divorced men’s incomes typically increase by about a third, while divorced women’s incomes fall by nearly a fifth. This can make saving for retirement difficult on more than one account. Not only do divorcees usually divide their retirement savings with their ex, but women have less to save afterwards. Some may even begin to worry that they will never be able to retire.
However, women who were once married and then divorced still fare better for retirement than women who never married at all. This is apparently because divorced women tend to accumulate more assets than their never-married counterparts, particularly in terms of real estate. The Center for Retirement Research says that one of the biggest indicators of retirement readiness for divorced women owning a house.
There is a difference between women who keep their marital homes and those who go on to buy new houses after divorce. In general, the latter are better prepared for retirement, as a house once shared with an ex-spouse and children may be larger, come with higher upkeep costs and a more substantial mortgage. This is not to say that no one in West Virginia should ever hang on to their homes during divorce. However, carefully considering the costs, implications and future retirement needs can help couples make the most informed decision possible.