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I’m 50 Years Old, Divorced and in Love with a Wonderful Man. Does It Make Financial Sense to Marry Again?

By Elizabeth Lewin 

emember how shocked your parents were when your best friend decided to move in with her boyfriend without the benefit of marriage?  Well, for many of us who “played house” before getting married, now the shoe is on the other foot—mom, divorced for the last 10 years, has just moved in with her significant other and the lovely couple has no intention of tying the knot.  Many people, 45 years and older, choose not to marry. Why? Here are five good financial reasons:

            1. To protect yourself against long-term care expenses: This is probably the No. 1 reason that older couples avoid marriage. In a marriage, the assets of both can be decimated by long-term care costs before the Federal Medicaid program takes over. By not marrying, the healthy partner's assets are kept safe, while the partner's assets are depleted.  

            2. To avoid losing pension benefits left by a deceased spouse, and Social Security benefits or alimony from a divorced spouse: You should be eligible to collect Social Security benefits on your ex’s claim, if they are higher than your own, as long as you were married for at least 10 years, you’re 62 or older and you haven’t remarried. Widows and widowers who remarry before age 60 cannot collect Social Security benefits on their deceased spouse’s record.

            3. To retain medical insurance: Many employer plans deny medical benefits to a surviving spouse who remarries. An individual policy will be expensive and most likely will not be as generous as the corporate plan. 

            4. To pay less in income taxes: There can be a tax advantage for couples who stay single.  Explains Paul Sterczala, CPA, a tax principal of Dworken, Hillman, LaMorte, & Sterczala, P.C., of Shelton, Connecticut, “If each partner has taxable income of $45,000 before standard deductions and exemptions, they pay about $1,500 less in Federal income taxes than a married couple with $90,000 of taxable income.  However, if their incomes are quite disparate, the two may pay more in Federal income taxes singly than if they were married.” Tax implications are something that you should look at closely with a financial advisor before retying the knot.

            It’s also worth factoring into your decision to wed or not to wed the fact that unmarried seniors are able to earn more income before Social Security benefits are taxed. If adjusted gross income, plus tax-exempt interest, plus one-half of Social Security benefits total more than certain base amounts, a certain percentage of your Social Security benefits can be taxed. By not marrying, either or both partners can work without affecting the other's Social Security benefits, which means more money in the household pot.

            Until recently, there were limits on how much you could earn without losing some retirement benefits, if you are under 70. Congress has removed those limits for people over 65. Sterczala advises people to always keep up with revisions in the law and what those changes can mean for their pocketbooks.

            5. To avoid antagonizing children from previous marriages: Some couples prefer to keep financial assets separate, in order to reassure children from a previous marriage who may resent a stepparent's gaining assets that the children feel belong to them.  But experts warn that if you stay single for your children, you should protect yourself and your unmarried partner in other ways.

            There are disadvantages to living together, says financial consultant Maria Elgar. “Live-togethers do not have the legal protections that married couples enjoy. There are no laws if they decide to break up, and no automatic legal rights to an inheritance or pension plan.” She advises that, if live-togethers want to provide for each other as well as their children, they must create their own safety nets by preparing pertinent legal documents, such as naming their partner as beneficiary of life-insurance policies and retirement accounts.

            Wedding vows unite couples “for richer, for poorer,” but you don’t have to let them make you poorer.  If you have your heart set on matrimony, you should at least know what the repercussions of those wedding bells will be.

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Financial planner Elizabeth Lewin is the co-author of the recently published book, “Family Finance” (Dearborn Trade).  She is also the author of “Your Personal Financial Fitness Program,”  “Financial Fitness for Living Together,” and “Kiss the Rat Race Good-bye.”  Elizabeth writes frequently for various magazines, has appeared on numerous national radio and television talk shows, and is on the Editorial Board of MAKING BREAD Magazine.

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