‘Grey divorce’ rates are rising — and it can be a financial minefield. Here’s what to know if you’re splitting later in life

A new survey suggests that many Canadians see financial benefits in staying in a relationship, which may help explain why divorce rates in the country have generally been declining. Research released by H&R Block Canada found that 80 percent of Canadians believe life is more affordable when living as a couple. The survey also reported that 73 percent think many individuals remain in marriages or common-law partnerships primarily for financial reasons.

At the same time, another trend is gaining attention: the rise of “grey divorce,” a term used to describe separations among people over the age of 50. Data from the United States shows that divorce among couples in this age group nearly doubled between the early 1990s and the early 2000s.

Canada has seen a smaller increase by comparison. Statistics Canada data indicates the divorce rate among Canadians over 50 rose by about 26 percent between 1991 and 2006, increasing from 4.2 to 5.3 divorces per 1,000 people. Since that time, the rate has remained mostly steady.

Amanda Baron, co-founder of the Canadian legal platform Jointly, says demographic changes help explain why the total number of grey divorces appears to be growing. Canada’s population is aging, and roughly 40 percent of Canadians are now over the age of 50.

According to Baron, the increase in divorces among older adults is partly the result of shifting social attitudes. People entering their 50s today grew up during a time when divorce became more socially accepted than it had been for earlier generations. As a result, individuals may feel less pressure to remain in unhappy relationships.

She also notes that many couples reassess their lives once their children are grown. Without the responsibility of raising kids at home, some people choose independence or pursue new relationships if they feel their current marriage no longer provides personal fulfillment.

Financial independence is another factor that has made divorce more attainable for older couples. Baron explains that many members of the baby boomer generation have accumulated significant assets, which can allow them to separate while still maintaining a comfortable lifestyle after dividing their property.

Despite that financial stability, divorce later in life can create complicated financial challenges. Mick Grewal, founder and managing partner of Grewal Law, says long marriages often involve decades of shared wealth that must be sorted out during a separation.

When couples divorce after many years together, property division can include multiple types of assets, such as the family home, vacation properties, investment portfolios, retirement savings and pension plans. With less time remaining in their working lives to rebuild wealth, mistakes in dividing these assets can have lasting consequences.

Grewal also warns that tax and retirement considerations are frequently overlooked in grey divorce cases. While property transfers during a divorce do not usually create immediate tax bills, incorrectly dividing pensions, investments or retirement accounts can lead to penalties and unexpected tax liabilities that reduce savings built over many years.

Spousal support is another issue that may arise, though it is not guaranteed. Baron says judges consider several factors when deciding whether support should be awarded. These can include the length of the relationship, differences in income between the spouses, and whether one partner sacrificed career opportunities to take care of children or manage household responsibilities.

Courts may also evaluate a spouse’s future earning potential, health issues, financial needs, and whether a prenuptial or marriage agreement addressed spousal support in the event of a breakup.

After a divorce, financial planning does not end with the settlement. Baron advises people to review estate plans, update beneficiaries on insurance policies or retirement accounts, and revise powers of attorney to ensure their wishes are properly reflected after the relationship ends.

Life after a grey divorce often requires a significant financial adjustment. Grewal notes that a single household suddenly becomes two, meaning expenses that were once shared must now be covered individually. If people begin dating again or remarry, additional financial questions can arise, including how assets will be handled in a new relationship.

Beyond the financial considerations, divorce later in life can bring emotional challenges. Baron says individuals may struggle to redefine their identity after spending decades in a marriage. Even adult children can experience sadness or uncertainty as they adapt to changes in family structure.

She recommends being open with adult children about the situation while maintaining healthy boundaries so they are not placed in the middle of disagreements. Emotional preparation is also important before starting the divorce process, as the experience can be difficult.

Baron encourages people to rely on trusted friends or family members for support and suggests that speaking with a therapist experienced in midlife transitions can help individuals navigate both the emotional and practical aspects of divorce.

Although separating after many years together can be challenging, careful planning and the right support can help people move forward. For some, leaving an unfulfilling relationship may also open the door to a more independent and satisfying new stage of life.