In today’s world, the golden years are no longer a guarantee of marital stability. With the rising trend of “gray divorce” — when older couples split up and recouple — many family offices find themselves navigating complex relationship transitions. In those situations, family offices face unique challenges, as new spouses or partners, blended families and evolving estate plans disrupt what were clear lines of inheritance structures and governance.
Gray divorce, which refers to separations among individuals age 50 and older, has become increasingly common. Between 1990 and 2010, the divorce rate among adults over 50 doubled in the U.S., and by 2022 it had tripled among those 65 and older.
This shift reflects a change in generational attitudes, particularly among baby boomers. Contributing factors to the rise in gray divorce include increased life expectancy, greater financial independence, changing social norms and the desire for personal reinvention later in life.
Divorce and remarriage later in life introduce complexities that require family offices to balance financial stewardship with relational sensitivity. Some key areas of consideration include:
Inheritance concerns and asset distribution: Adult children often worry that a stepparent could dilute their expected inheritance. This concern increases when a father remarries someone younger and starts a second family. A common scenario to anticipate is when a stepparent outlives the spouse. Do the second wife and her children continue to live in the family home with all the belongings that may have sentimental and significant monetary value to the stepchildren? Or are the stepchildren the beneficiaries of the family home? Does the stepparent get to stay and pay rent? Or will the stepparent be asked to leave?
Potential for family conflicts: With divorce and the addition of new family members, conflict can arise due to divided loyalties, broken promises and unexpressed resentments. Tensions are likely to increase if estate plans are changed. Family members who are employed by the family enterprise can become aware of allocations of resources to half-siblings and their stepparent, while other family members are not. This can strain loyalty and trust and may trigger legal issues.
Litigation risks: In gray divorce and remarriage situations, a lack of transparency about changes in estate plans can foster resentment and animosity. Family members who feel excluded often imagine “worst case” scenarios. Without clear communication about the degree of changes and how expectations and promises will continue to be met, there is a greater likelihood of distrust, misunderstandings and potential litigation.
Best practices
To help families manage the complexities of gray divorce and remarriage, family offices can consider implementing the following practices:
Use clear governance structures: When divorce happens, so does confusion about who will be involved and to what degree — especially if new partners or spouses, and their children, join the family system. One way to minimize confusion and allow for appropriate integration is to ensure governance frameworks are adapted to include new family members while continuing to honor previous ones.
Invite the family to co-create or revisit their decision-making process and their family constitution: Do their shared family values need to be further clarified? Does their conflict resolution policy need to be updated? Will their family employment policy need to be redefined? A process of inclusion yields greater engagement and greater likelihood of adoption, especially with those who will be impacted by the resulting decisions.
Consider having clear criteria for who is eligible to participate in an owners council or a family council, with the understanding that the definition of “family” may have changed. These councils can address significant issues related to designing and enforcing family policies and standards.
Focus on transparency: Family offices can advocate for consistent communication with all family members and help establish a framework to discuss sensitive issues. One way to do this is by establishing a cadence of regular meetings to facilitate ongoing dialogue and keep family members informed of financial and estate planning updates. Open forums for discussion can help dispel assumptions and provide clarity. Using third-party facilitators for these discussions can also add a neutral perspective and create a safe environment for candid conversations.
Consider the benefits of pre- and post-nups: Family offices can help mitigate the risks associated with gray divorce and remarriage by advocating for prenuptial and postnuptial agreements to protect all parties. According to Andrea Vacca, a collaborative divorce attorney and mediator, “These agreements not only encourage the married couple to have open and honest discussions about their expectations and desires for how their newly blended family will or won’t share in the couple’s wealth, but they also help prevent conflicts over the estate in the future.” And for couples who choose not to remarry but live together, there is also great benefit in having a cohabitation agreement.
As older couples pursue personal reinvention, their choices can reshape family dynamics, complicate financial legacies and create challenging transitions. Family offices play a crucial role in balancing these financial and relational considerations, helping families stay aligned with their goals while managing the intricacies of wealth preservation and distribution.