We've talked before about the unique financial challenges for people who divorce as they near retirement age. Preserving a fair portion of the retirement nest egg that you and your spouse have built over years and possibly decades is key. People who divorce later in life, particularly women who have been out of the full-time workforce for awhile, have a more difficult time rebuilding their finances after divorce than younger people do.

Know What's Going on with Your Retirement Accounts

Both spouses are required to present complete and accurate financial records during the divorce process. Of course, not everyone does. Spouses have been known to hide money. Sometimes they spend or move money the other spouse didn't even know they had so that there will be less to split.

For older people who are divorcing and depending on retirement accounts to help them live a comfortable life in their later years, it may be worthwhile to hire a financial professional to research all marital assets and ensure that nothing untoward has been done with them. If you left all of the financial matters to your spouse during the marriage, it's particularly important to make sure that you have an accurate picture of the assets you'll be dividing.

The IRS Can Be Your Friend

Spouses have been known to make large withdrawals from their 401(k), rollover IRA and other retirement plans so that there will be less when the assets are split. Even if the spouse shredded all of the documents, the Internal Revenue Service can provide the evidence you need.

When you make a withdrawal from a retirement account, the institution where the account is held generates a 1099-R form so that you report it accurately on your taxes. The IRS gets a copy of this form as well. Therefore, even if the spouse didn't report the withdrawal, the IRS has documentation of it. That's why forensic accountants and other financial experts who help divorcing spouses will often look at tax returns along with other financial records.

If you are considering divorce or believe that your spouse is, it's best to seek legal guidance early. Your family law attorney will likely advise you to do as much research as you can into your assets and debts, both as a couple and individually. This can help you find out if your spouse has been hiding assets, withdrawing money from accounts without your knowledge or engaging in reckless spending that could impact your divorce settlement and lifestyle during your golden years.

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