If you divorce when you are young, you may not think too much about how it will impact your retirement. However, if you have a nice retirement plan in place or you are an older person, the effects of your divorce on your retirement may be a pressing issue. After all, it took time for you to build your retirement accounts, and you may lack the time to get them back to where they were prior to the divorce.
According to Forbes, your retirement will most likely take a hit due to your divorce because the court will typically split retirement accounts. While it may be possible to reach some type of agreement with your former spouse to leave your retirement accounts untouched, this is often impossible to do while also allowing for the fair distribution of marital assets as the law in Iowa requires. This can present you with potential retirement issues that you now need to address.
After a divorce, your living expenses will likely be different than they were during your marriage. You now have one income when previously you may have had the help of your spouse. If the court ordered you to pay spousal support, then you have that additional expense. The same is true if you now pay child support. Your finances look a lot different, which will alter the amount of money you will need in retirement.
You should redo your budget for your post-divorce situation. This will help you to see if you are still on track to retire on schedule or if you need to make changes.
You may have to work longer than you want to in order to rebuild the retirement savings you had prior to the divorce. For many people, this is inevitable. If you do not have any other means by which to bulk up your savings, then you probably will have to work longer and put off retirement until later.