I’m 52, make $200K and have $2.4M in assets after a divorce. How can I protect my wealth and still enjoy life solo?

Her two children are grown. She rents a two-bedroom apartment. She’s maxing out her 401(k). She expects that, between a small pension and Social Security, she could receive around $5,800 a month in fixed income in retirement.

On paper, she appears financially secure.

But here’s the kicker: she wants to protect her wealth for the long term, while also enjoying this next chapter with confidence rather than guilt.

The 'gray divorce' dilemma

Karen’s situation is hypothetical, but the crossroads are very real. So-called ‘gray divorce’ has risen sharply in recent decades.

According to the National Center for Family & Marriage Research, the divorce rate for adults age 50 and older roughly doubled between 1990 and 2010 (1). Research from Purdue University has reported that in 2022, about 15% of divorces involved adults age 65 and older (2).

That means more Americans are dividing assets during peak earning years, often with just 10-15 years before retirement.

For someone in midlife, like Karen, poor investment decisions, an overly aggressive spending plan, or failure to update legal documents can derail decades of careful saving.

As Certified Divorce Financial Analyst (CDFA) Laurie Itkin puts it, one of the classic errors wealthy divorcees make is “assuming your money will last for the rest of your life” simply because the dollar figure looks large (3).

"Those without any knowledge of investing assume they can leave hundreds of thousands of dollars in the bank as a safety net, which they can pull from when they need cash. These people are often scared to invest their money … because they worry about historical market crashes … However, fear is not a plan," Itkin asserts (3).

This can lead to leaving large sums in low-yield accounts or spending prematurely without a strategy, gradually eroding wealth over time.

But a few smart financial moves can help balance freedom and intentional spending, with long-term financial durability and asset protection:

1. Diversify and reduce single-stock risk

A large portion of Karen’s portfolio sits in one company’s stock — which is a common outcome in divorce settlements.

Holding concentrated positions can increase volatility. Diversification across asset classes and sectors can help reduce portfolio risk while maintaining exposure to market growth.

One of the most common mistakes high-net-worth divorcees make is failing to reassess risk tolerance after the split. During marriage, investment decisions were often made jointly. Post-divorce, the emotional and financial landscape shifts.

Karen might consider gradually reducing her exposure to one company — while managing potential capital gains tax implications — and reallocating across broad-based funds. The goal here is resilience, not aggressive growth.

2. Maximize catch-up contributions while income is high

At 52, Karen is still in her prime earning years. The IRS allows workers age 50 and older to make additional “catch-up” contributions to retirement accounts. For 2026, the total 401(k) contribution limit for participants age 50 and older is $32,500, including catch-up contributions (4).

Continuing to max out tax-advantaged accounts while her income is strong could improve flexibility later — especially if she faces an unexpected job loss before retirement.

Stress-testing retirement scenarios using conservative return assumptions can also help identify gaps before they become urgent.

3. Think carefully about Social Security timing

Karen plans to work for several more years, but she wonders when to claim Social Security.

According to the Social Security Administration (SSA), benefits claimed at age 62 are permanently reduced compared to waiting until full retirement age — which is 67 for those born in 1960 or later. Delaying benefits beyond full retirement age can increase payments up to age 70 (5).

For high earners with other income sources, delaying may function as longevity protection by increasing guaranteed lifetime income.

Divorced individuals who were married for at least 10 years may also qualify for benefits based on an ex-spouse’s earnings record — provided certain eligibility conditions are met.

Understanding these rules can help Karen evaluate her options without locking herself into a premature decision.

4. Update estate documents and insurance

It's important to remember that divorce is also a legal reset.