“Markets go up and markets go down” is the philosophical view of a financial advisor who participates in attorney Linda Gross’ “collaborative divorce” study group. But for divorcées, says Gross, a certified family law specialist in Santa Monica, Calif., it’s the state of finances at a fixed point in time that’s relevant. She notes, “There are many issues yet to be resolved around divorce and retirement,” many of them exacerbated by the economic downturn. Among them:
1. Slow recovery from the 2007-2009 bear market. “Prior to the market crash, lots of couples thought they had plenty of money,” Gross points out. Many still haven’t recouped the net worth they lost.
2. An unwelcoming job market. How can a divorce court judge impute future income to an older spouse who can’t find work? One of Gross’ clients, a 58-year-old woman with a Harvard MBA, has been looking for a suitable job for five years.
3. Hard-to-get health insurance. Marlo Van Oorschot, a family law attorney in Los Angeles and author of “How to Survive Grey Divorce,” points out that finding health care coverage can be difficult for divorcées under 65 who were covered by their husband’s policy. Issues with pre-existing conditions, plus the substantial expense of COBRA or an individual policy, may make it essential to find a job with group benefits until Medicare kicks in.
High local unemployment forced one of Van Oorschot’s clients, a stay-at-home wife for almost 20 years, to seek a job in another part of the state and rebuild her life there.