Increasingly, people are divorcing in their 50s, 60s and even later in life. If you’re among those preparing for what’s been termed “gray divorce” and you expect you’ll have to pay spousal support (alimony or maintenance), you may wonder what that means for your retirement plans.
Even permanent alimony, which is rarely ordered anymore, is subject to modification if one or both parties’ changed circumstances warrant it. Retirement is a qualifying circumstance. That’s assuming, of course, that a person is of a reasonable retirement age or in a profession where their physical condition may not allow them to continue working or where there’s a mandatory retirement age.
As in other states, both spouses’ income and earning potential are key factors in determining if one will pay the other alimony — and if so, how much. A significant change to income on either side is a valid reason for seeking a modification or even an end to alimony. An exception to that would be if someone intentionally chose not to work or earn as much as they potentially could to avoid helping support their ex.
That doesn’t mean people are expected to work for the rest of their lives. Courts regularly grant changes to spousal support orders when people retire.
Making a case for modifying alimony upon retirement
It’s still important to present a solid case when the time comes. In fact, as soon as you have a planned date for retiring or transitioning to working part-time or intermittently, you should begin preparing your case. It will be crucial to show that you’ve reached a reasonable retirement age based on your occupation and health.
Of course, retirement doesn’t mean the end of your income. You’ll need to show how much you’ll be receiving in Social Security retirement benefits, VA benefits, a pension and other income. You’ll need to show what you have in assets like your IRA and other investment and savings accounts.
The court will also consider your spouse’s other sources of income as well as their assets. It will look at whether they’re working – and if not, why not.
It’s typically best if you can discuss the matter with their ex to make the transition easier financially for both of you. However, even if they agree that the modification or end of alimony is warranted, it still has to go through the court since spousal support is court-ordered. Having legal guidance can help things go as smoothly as possible.