It's hard to break your marriage vows and still leave your retirement savings intact.
Legal fees will ensue. Assets will be split in two. Your two-income household will shrivel down to one.
When all is said and done, ending a marriage can be almost as destructive to your retirement savings as the Great Recession was, according to new findings from the Center for Retirement Research at Boston College.
"There's a big financial cost to splitting up homes," said Geoffrey T. Sanzenbacher, associate director of research at the center and one of the study's authors.
Around 40 percent of marriages today end in divorce.
The researchers at Boston College looked at how divorce impacts the National Retirement Risk Index, a measure of the likelihood an individual will be able to sustain their current standard of living once they leave their working life.
As of 2016, half of working-age households were at risk. Divorce pushes up an individual's retirement risk by 7 percentage points, the researchers found. For comparison, the 2008 financial crisis added 9 points.
The average net worth (not including housing) for families unscathed by divorce is $132,000, compared with $101,000 for those households that have been halved, according to the center.
"It's an ugly situation overall, and divorce just makes it harder," Sanzenbacher said.
The authors of the study provide a breathless list of reasons for why divorce threatens your golden years.
Lawyers need to be paid. The ordeal requires time, potentially pulling people away from work. Women, in particular, are more likely to need to take time off from work to take care of their children.
Many splitting couples will sell their house, which spurs transaction costs. And there's no connection between when your love fades and how the housing market is faring. Retirement savings can be divided in two, leaving each person with a less reassuring balance.
Divorcees will also typically find their expenses have swelled, with two households to pay for instead of one.
There's more: Many newly single people will have to adjust to a higher tax rate.
Men or women who are forced to pay alimony will have that much less to store away for their retirement. And singles will likely find themselves with access to a smaller line of credit than when they were married.
Yet, there are some retirement savings advantages to divorce, said Louise Nixon, president of QDRO Counsel, a California- based firm that focuses on the division of retirement benefits. You'll need to use a court order known as a domestic relations order, or Q.D.R.O., to reach those silver linings.
If you do, the nonparticipating spouse of a 401(k) can typically receive funds from their ex's account as cash and not have to pay a tax penalty for early withdrawal, Nixon said. Those funds will still be subject to regular income taxes. (Sanzenbacher at Boston College said people should avoid spending this money and keep it for their old age. Nixon said some people will want to use the funds to pay off debt or buy a house).
If it was your 401(k), it's still not all bad.
"The benefit for the participant after divorce, [is] he or she has the job and will continue to accrue benefits under whatever plans are offered by that company," QDRO Counsel's Nixon said. "One hundred percent of those post-divorce benefits belong to the participant."
Once the dust is settled after a divorce, Sanzenbacher said, "assess where you are in respect to your retirement savings."
Nixon said many of her clients come to terms with the fact that they'll need to adjust to their new status.
"I hear people say, 'I was planning on retiring. Now I have to work five more years,'" she said.