Ex-Couples: How Alimony Works

by Stacy Francis, CFP®, CDFA, Founder Savvy Ladies 

“It is easy to preach financial independence,” a new Savvy Ladies member remarked at a recent seminar, “but I have already spent ten years as a housewife. My husband and I are miserable together, but there’s no way I would survive without his financial support.”

Unfortunately, her situation is far from uncommon. But the good news is that she can get divorced and still maintain a fair standard of living while she gets back on her feet and starts a career of her own. How? The answer is alimony.

| Alimony is financial support paid by one ex-spouse to the other after the marriage has legally ended. Alimony is also sometimes called spousal support.

How Does Alimony, Spousal Support Work?

While not a given right, US law mentions that parties in a divorce should be able to live “according to the means to which they have become accustomed.” This means that if, during the past ten years, you made zero dollars while your spouse made $300,000 per year, chances are pretty good that you’ll be able to maintain a decent lifestyle on your own. Each state has its own laws governing alimony. Spousal support is usually part of a divorce case that the court will address. Most spouses who are still married but separated can also seek spousal support in most states. It is important to check your state guidelines.

The length during which an ex-spouse receives alimony depends on many things, from age (younger individuals are generally considered as having better chances to move on with their lives) to how long the marriage lasted. So, while nothing is guaranteed, there is still hope!

How to Begin the Process for Getting Alimony from my Spouse?

One or both spouses must request it from the court – and can be stated at the initial filing for divorce. Alimony can be agreed upon through mediation, or the issue can be resolved in court, where a judge will decide. Alimony payments can be structured in many ways, from a one-time lump sum to payments over time. Again, states can look at various variables and make the determination based on the length of the marriage, an illness or disability.

Types of Alimony

Each case is specific to you and while it may vary by state, alimony can be structured as durational alimony for a specific length of time that is deemed necessary is one common option. Another is rehabilitative alimony, where payments are provided to allow the recipient to obtain the education to become self-supporting. There is permanent alimony for spouses who may be disabled, unable to work, ill, or elderly.

It is important to check with a divorce attorney and to have a CDFA, a Certified Divorce Financial Analyst, as you go through your divorce to make sure you are set up for a secure financial future.

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