If you’re nearing or already in your senior years, you’ve probably heard and read a lot about downsizing. If you’re “empty nesters,” your home can suddenly seem very large. You might not have the energy or want to spend the time needed to keep it clean – or want to pay someone to do it.
If you’re preparing for divorce, that can actually be a good excuse to downsize to a smaller place. Unfortunately, some older divorcing couples still end up fighting over a home that’s too big for them together – let alone either of them separately. They often fight over all the stuff they’ve accumulated throughout the years – even if they don’t really want or need it.
Putting the money toward retirement
In fact, it can be a much smarter financial move to sell the home and split the proceeds. According to one certified divorce financial analyst, “If a home is going to be more than 70 percent of your net worth, you should consider whether you can really afford it.”
If your spouse wants to keep the home, you can let them buy out your share. Just make sure your name is removed from the mortgage, if you still have one. If they’re also attached to the furnishings and valuables that are in the home, you can decide which ones – if any – you want to keep and then make sure you are compensated at fair value for your share of what your spouse keeps. This can leave you with more retirement savings, even after buying a small condo or renting an apartment.
Understanding your own motivations
None of this is to say that it’s “wrong” to want to keep the home and the things in it after divorce. However, it’s important to make decisions based on what’s best for your future rather than on sentimental attachments from the past or to keep your soon-to-be ex from getting what they want. As the head of the American Academy of Matrimonial Lawyers says, “When couples fight about their stuff, they’re fighting more about the memories attached to the stuff than about its market value.”
By getting your own financial and tax advisors during divorce, in addition to having experienced legal guidance, you can work to seek the best possible settlement within Texas’ community property laws. This will help you be in a strong financial position to move into the next phase of your life.