Category: Spousal Support
Questions/Answers
What is a "Reservation of Right" of spousal support
A "Reservation of Right" means that you are not asking for spousal support at the time of the divorce but you wish to reserve your right to support in the future in case of a change of financial circumstance. In Virginia, you must request the reservation of right in order for the court to award it to you. Frequently, a reservation of right will be for a specific term of years, often for half the length of your marriage. This support option use to be mandatory if requested but recent legislation makes such an award optional at the discretion of the court.
How does a QDRO work in spousal support?
An example may help: suppose that your ex-husband is ordered to pay you $500 a month in support. He fails to make these payments, and soon is in arrears to the tune of $10,000. You would be able to obtain, under the laws of your state, a QDRO that would order the arrearage be satisfied by means of a garnishment of your ex-husband’s pension plan.
Can we negotiate for permanent alimony?
Yes, permanent alimony still exists. There is nothing stopping a couple from negotiating and agreeing to an award of permanent alimony. Outside of a unique situation, permanent alimony is rarely awarded. Basically, the factors controlling permanent alimony are; the recipient ex-spouse has no realistic chance of employment, and the marriage had endured for a long period of time. Please keep in mind, it is also not uncommon for the paying spouse to take out a life insurance policy or an annuity, naming the receiving spouse as the beneficiary.
Can I provide for a one-time payoff of spousal support in my agreement?
Yes, such a payout is often called “lump sum" alimony. Lump sum alimony is frequently given instead of, or along side of a, property settlement, especially when there is little or no property to divide. Lump sum alimony is unusual in that it is payable even if certain events occur that would normally cause the cessation of alimony, such as remarriage. Since lump sum alimony is often in lieu of a property settlement, the present or future status of the recipient does not affect the alimony, if the separation agreement so states. Lump sum can even be made payable to the estate of the recipient, should he or she die.
Can I waive spousal support in my separation agreement?
Yes, you can waive spousal support, so long as the waiver is knowing and intentional, and there is a full disclosure of all assets and income (typically with a signed financial affidavit or income and expense statement). You may not waive spousal support if it would mean that you would be impoverished or you would become a public charge (collect welfare). The court will look out for the spouse who deserves or needs support just as they look out for the children when it comes to child support.
Can I address spousal support in my separation agreement?
Yes. Separation agreements can fix spouses’ rights and obligations to spousal support. Spousal support is usually what people think of when they hear the words “separation agreement." The agreement will be subject to judicial review in most states. Be aware, that a spousal support agreement or clause within a separation agreement can be set aside if it fails to meet the requirements for a valid contract, or if the spousal support is totally inadequate according to the financial circumstances.
Is Alimony Always Awarded to One Spouse Upon Divorce?
If decided and ordered by the judge, it is almost always considered on a case-by-case basis. There are serveral factors that are considered and these factors vary from state-to-state. The primary factors are the length of marriage, income of each spouse, and the ability of each spouse to gain employment. Also keep in mind that Alimony is not always permanent but it can also be on a temporary basis.
Helpful Tips and Facts
Rehabilitative Alimony in Michigan
In Michigan, a no fault divorce state, the trend is toward rehabilitative alimony. "Rehabilitative Alimony" is temporary support to help a financially dependent make the transition to self-support. The Court often considers the length of marriage, the age of the dependent spouse, and the dependent spouses earning capabilities when deciding whether to grant permanent, long-term, or rehabilitative spousal support.
Cost-of-Living Adjustment
Some divorce agreements contain a clause for automatically adjusting the amount of support every year, based on changes in the cost of living. This is called a "cost-of-living adjustment" or COLA. You can find cost-of-living changes via the U.S. Department of Labor, Bureau of Labor Statistics, Consumer Price Index tables at this web site: (http://data.bls.gov/cgi-bin/surveymost?cu). Checkmark your geographic area from the bottom half of the list that is displayed, then click Retrieve Data. The calculation for determining the increase in the cost of living is: subtract this year’s number from last year’s number, then divide that difference by last year’s number. For example, to compare June 2007 to June 2006, it would be (228.258 - 222.6) / 222.6 = 5.658 / 222.6 = 0.0254, or an increase of 2.54 percent.
Beyond Spousal Support
Alimony -- also called support, maintenance -- is usually a temporary measure. As a rule, spouses receiving spousal support are ultimately responsible for their financial future. If a party has receives significant property, it is wise to make investments with the assets.
What is Temporary Becomes Permanent
It is not always the case, but 9 times out of 10, the temporary (pendente) order for alimony will become permanent upon the divorce becoming final. In the cases where this is not true, the property settlement is skewed enough towards the payee’s side, that a lesser amount is justifiable.
Negotiating a Lump Sum Payment
The payor will always try to pay a less amount in lump sum, then he or she would pay over a longer period of time in periodic monthly payments. This is truly the incentive a payor has to offer a lump sum payout. The payee must recognize the financial sacrifice he or she is taking by accepting a lump sum payout, while not forgetting the immediate taxes that will be paid.
The Lump Sum Payment Option
The lump-sum payment option is often enticing to both parties. Alimony or spousal support paid as a lump sum will permit the payor to pay less and the payee gets a larger sum of money at the time of the divorce. For example, it would be easier for a payee to purchase a home after the divorce is final if he or she received a lump sum payment from the payor.
Factors Considered
While fault may still be a factor in determining alimony in some jurisdictions, courts today normally consider need, ability to pay, length of marriage, age and the health of the parties when determining the award.
Marital Fault
Marital fault is not always a factor that the court considers when determining alimony or spousal support. For example, a spouse may not be penalized in an alimony award if he or she committed adultery.