Q & A
What are the ramifications of divorce on Social Security claiming strategies?
Full Question: I will turn 62 in November. My wife has been the principal wage earner over the past 25 years while I raised our now adult children. I worked as a self-employed manufacturers’ representative from 1991 to 2007. From 1976 to 1990, I earned an average of about $50,000 per year at other regular jobs. My wife is 57, still working, and has typical annual earnings in the $150,000 to $250,000 range. We each have IRAs with about $300,000 in them and a decent savings account. We owe no money on our house. There is a possible separation or divorce on the horizon. What would your recommendations be for me? For her?
Answer: I’m sorry to hear about the pending separation or divorce. Your goal is to avoid going to financial war over this, which will only enrich lawyers. A fair way to resolve any financial conflict is to establish a division of resources that produces the same living standard for each of you going forward.
Economics-based financial planning software offered by my company or other companies that tells you about your future living standards can assist you with this. You can also use software to determine what divisions of assets and levels of alimony, if that’s needed to equalize living standards, will be most tax and Social Security efficient for maintaining the highest equal levels of your future living standards. Read more…
Source: Laurence Kotlikoff – Forbes, via www.divorcedsinglesnews.com, 10/8/2014