Financial planners and other professionals find that “gray divorce” — divorce among those more than 50 years old — is affecting estate planning, according to a recent survey.
Forty percent of respondents say gray divorce is leading to a rise in family strife, according to a survey of 112 lawyers, trust officers, accountants, charitable giving professionals, insurance advisors, elder law specialists, wealth managers, educators and non-profit advisors conducted in January by TD Wealth.
Family conflict remains the top threat to estate planning for the second year in a row, TD Wealth says.
But estate planners also named tax reform, along with prolonged life expectancy and increased healthcare costs, as among the biggest challenges to estate planning, according to the survey.
In addition, 39% of respondents say the retirement planning and funding aspect of estate planning gets impacted by gray divorce, TD Wealth says. Seven percent of respondents say gray divorce also affects who will be responsible for enacting a power of attorney, while 6% say it impacts determining appropriate Social Security benefits and 5% believe it affects the drafting of a will, according to the survey.
"Gray divorce is adding another layer of complexity to the estate planning process that already arises with blended families, designation of heirs and the ever-changing domestic structures,” Ray Radigan, head of private trust at TD Wealth, says in a statement. “As a result, it’s more important than ever to proactively review and discuss the estate plans with our clients and their families on an ongoing basis."
TD Wealth found that 43% of respondents cite not communicating the estate plan with family members as the most common cause of family conflict while engaged in estate planning. The second most-cited cause is dealing with blended families, cited by 29% of respondents, according to the survey. But while 30% of respondents cited designation of beneficiaries as a cause for conflict in 2019, that figure dropped to 13% in this year’s survey, TD Wealth says.
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