Gray Divorce: Facing the Economic Challenges

A few months ago, we wrote a blog about a new trend they’re calling gray divorce—late-life divorce. These days, one out of every four people experiencing divorce in the United States is 50 or older; nearly one in ten is 65 or older. The reasons vary, but may include empty-nest syndrome, the increased number of women in the workforce, the desire for a better quality of life and higher rates of remarriage.

The emotional distress and challenges of gray divorce are similar to those of divorce at any age, but older couples face additional obstacles that magnify the difficulties. They often face a limited number of years in which they can generate income, have complicated assets and adult children who may get involved. There is another depressing statistic: for those on their second or third marriage, the rates of divorce are even higher.

Customize a team of advisers customized for your needs

If you’re an older couple facing divorce, many experts recommend identifying a team of professionals to guide you through the process. Depending on your emotional needs and the complexities of your financial landscape, this team may include a mediator, financial planner, accountant and/or therapist. If the divorce is uncontested—if you’re in agreement about the division of assets–California Document Preparers can help you get your divorce. Our team of family law specialists prepares and files all of the legal documents and is sensitive to the emotional needs of our divorce clients; we’re available by phone and email to respond to questions throughout the entire process.

In a gray divorce, working with a financial expert becomes more important because most couples have built up a lifetime’s worth of assets that must be valued and split. There’s the family home, pensions, 401k’s, brokerage accounts and life insurance policies to be taken into consideration. There may be the family business or investments in other ventures, expensive artwork, antiques, vehicles and valuable collections that also must be assessed as part of the estate. Valuing these complex assets and income streams requires time and expertise.

Who gets to keep the family home?

The family home is often a point of contention, especially with older couples. We all can understand not wanting to leave 20 or more years’ worth of memories. This was where you raised your children, where the family gathered to celebrate holidays and important events. There is the familiarity of the neighborhood and good friends. Given the uncertainties that lie ahead, the family home’s appeal can become amplified, as it represents familiarity and a connection to a former, happier life.

Hanging on to the family home may not make sense financially

Divorcing couples need to understand that when they were living together as a married couple, in many cases, they had two incomes. In their new single lives, there will be just one. It’s a time to get very realistic about finances and think pragmatically about how you will support yourself on one income. Be open to alternatives that will leave you in a better financial position. Selling a home or opting for other assets may provide the income you will need in the years ahead. That large family home with a swimming pool and extensive landscaping can quickly become a burden. Many divorcing midlife couples find that downsizing can dramatically help manage costs as they create new lives for themselves.

Call the California Document Preparers team today to schedule an appointment to talk about your divorce. We help you through every step of the process.

Probate Case Study: Siblings Lose Family Home

A man recently came into our Walnut Creek office with a Probate case. His father and stepmother had owned the family home as joint tenants. When his father died a few years earlier, his stepmother became the property owner. But now the stepmother had died and the ownership of the estate was in question because neither the father nor the stepmother had created a Living Trust.

Our client’s father had married his stepmother when he was just 14, and this kind woman with no children of her own had helped raise him. They remained close through the years, and after his father died, he became her caregiver, running errands, taking her to doctor appointments and making her final years as comfortable as possible.

There were four children in this family, and though their children all encouraged him, their father had never created a Living Trust. Their stepmother often spoke about how the home should go to these siblings when she died, but along with her husband, she failed to put anything into writing. When she died, her only blood relative was her sister, who lived in France. According to the law, if someone dies without a Living Trust to identify the distribution of assets, the estate goes into Probate.

The stepson took the case to Probate court

This was an emotional case for our client, as the bulk of the estate was the family home in which they had grown up. This was the place where they had gathered to celebrate holidays and family events. This wasn’t just a house to this family, there was a lifetime of memories living within its walls. In addition, he and his siblings had all been very close to their stepmother—they had lost their own mother at an early age, and they were all delighted when their father remarried. They also knew that their stepmother had a strained relationship with her sister, and they’d not seen each other for many years.

While they understood that there were laws governing the distribution of assets when someone dies without a Living Trust, they were hoping there could be compromise, such as splitting the estate between the families—the four siblings would receive half of the estate and the sister would get the other half.

The judge made his ruling based on the letter of the law—not emotions

The Probate judge well may have been sympathetic to our client’s situation—the logic of this scenario is very compelling. The father and stepmother had been happily married for more than 40 years and would surely have wanted their children to be their beneficiaries. Unfortunately, neither the father nor the stepmother had created a Will or Living Trust, so the court was forced to make a decision based on the law, which is that the estate goes to the next of kin, based on bloodlines—in this case, the sister in France, who ended up with 100% of an estate valued at an estimated $600,000.

This is a situation that we see all too often . . .

Fortunately, it’s easily preventable by creating a Living Trust—and keeping it updated with important life events.

Call the California Document Preparers team today to schedule an appointment. We help you through every step of the process.

End of Life Option Act: Only for the Privileged?

California's End of Life Option Act took effect in June 2016. One of the biggest concerns from the bill’s opponents was that masses of people, particularly the disadvantaged, would be targeted and coerced into dying if physicians were allowed to prescribe a lethal dose of medicine for those who were terminally ill. But if we take a look at those states where the law has been in effect long enough to provide meaningful metrics (Oregon passed its law nearly 20 years ago), those fears have not been realized. A recent Los Angeles Times op-ed article by Ann Neumann discusses the realities of who is actually using this law.

Who will use the new law?

It’s been just a few months since the law went into effect here in California, so it’s too soon to know its full implications here at home, but in those states where aid in dying is legal--Oregon, Washington, Montana and Vermont--the number of people choosing to use this law is fewer than 1% of those who die each year. Based on 18 years of data from Oregon, whose Death with Dignity Act was the first such law in the nation, the majority of those who use the law are older, white and well-educated.

End of Life Option Act: a matter of insurance coverage and economics

When demographics such as education level and insurance type are analyzed along with race, Oregon's data tell us that it is the privileged who use aid in dying. Nearly 72% had at least some college and private insurance.

According to a National Public Radio report, the cost of a lethal dose of the most commonly prescribed aid-in-dying drug — the sleeping pill Seconal — rose from $1,500 to more than $3,000. Even a less expensive drug cocktail costs about $400. Insurance may cover at least some of the cost; it is up to each plan. State Medicaid funds are available in Oregon and California, but federal funds cannot be used for aid-in-dying drugs.

Aid in dying protocol a complex process

Given the nature of death with dignity laws, it isn't surprising that only a small number of people choose to make use of the right to die--it's a complex process. To get a prescription for lethal drugs, patients must be adults, and they must be deemed by two doctors to have six months or fewer to live. Patients must request a lethal prescription verbally and in writing, with a waiting period in between. If their mental competence is questioned, a psychiatrist must be consulted. Once patients obtain a prescription, they choose when to fill it and when to self-administer the drugs.

Oregon data provides a profile of who uses aid in dying

From 1998 through 2015, a total of 991 Oregonians died from ingesting DWDA drugs.

• A majority were over the age of 65 (nearly 70%).
• Slightly more were male (51%) than female.
• Most were diagnosed with terminal cancer (77%).
• Almost all were enrolled in hospice care (90%) and died at home (94%).

Racial and socioeconomic demographics of Oregon’s law

Nearly 97% of those who have exercised the right to die in Oregon were white. Keep in mind that Oregon has a relatively small minority population, but even where the percentages are higher, it's probable minorities will make use of the law in lower numbers. California’s population is much more diverse, so the numbers may be distributed more evenly across all demographic groups, though it’s too early to identify trends.

Data raises question whether aid in dying is working

If the premise of aid in dying is to prevent pain and suffering among terminally ill patients — something people of all races and from all walks of life experience — the narrow pattern of use that shows up in the data is a cause for concern. The availability of choice may be the primary factor behind the predominance of white, privileged patients seeking and using aid in dying.

Those with means always have more choices

Unfortunately, this law may represent another example of the growing disparity not just in American lives, but in the healthcare choices of its citizens.

Are you still thinking about creating a Living Trust in 2016? The California Document Preparers team can help you. Call today to schedule an appointment.

September Kicks Off the New Divorce Season

Another summer is drawing to a close and it always comes too soon. Our vacations were invariably too short, the time with our friends and family too brief. Now we find ourselves shivering in the mornings as we get ready for work and evenings on our decks and patios have turned cool. We’re packing the kids off to college or back to school. September is also the time when an increasing number of couples file for Divorce.

While there are no official statistics, divorce lawyers are noticing a new trend—a significant increase in the number of couples who are deciding to split up at the end of the summer. According to divorce lawyers and law professors, it’s a deferred decision that’s generally been made months earlier.

There is a variety of reasons triggering the September divorce trend

• Family vacations. Summer is the time for family vacations that many prefer not to disrupt, and summers can mean less stress on struggling marriages. Parents may be taking time off work, the kids are away at camp. For those with vacation homes, it may mean that couples have extended time away from each other, which provides some breathing room. When they return at the end of August, it’s time to once again face reality.
• Empty-nest syndrome. When the last child leaves for college or career, many couples find themselves staring at each other across the kitchen table and realize they have little reason to stay together. If they’re still young and healthy, there are many empty years stretching ahead of them. They may still want to be married--but they want a different spouse!
• Last-ditch effort. People are unhappy with their marriages, and their summer vacation represents an opportunity to give it one last shot. This effort is generally unsuccessful because the expectations are too high. Anyone who’s done any traveling understands the toll it can take on a relationship. Vacationing couples are faced with unstructured time, alone with each other 24/7, which rarely happens at home, where everyone is busy with work and activities. Rather than fixing things, this puts additional pressure on an already shaky relationship.
• Time for evaluating lives. For many people, September is a time for evaluation and catharsis. There is something psychological about September. It began back when we were in grade school. Even though we're not at school anymore, the memory of fresh beginnings, new clothes, school supplies, etc. is seared into us. We make New Year's resolutions at the start of the year, but for many people there's something equally, if not more profound, about September as the time for fresh new starts.

Are you thinking about Divorce? If yours is an uncontested Divorce, you don’t need an attorney, and the California Document Preparers team can help you. We’re especially sensitive to the needs of our family law clients. Call today to make an appointment.