How Much Alimony Is Enough?

When a marriage ends, most divorcing couples acknowledge that a certain amount of spousal maintenance or alimony is needed. But how much is enough? And how long should it be given?

When Michael Douglas divorced, his ex-wife emerged $45 million richer and was also entitled to any future earnings on things he worked on during their marriage.  

Camille Grammer, once married to Kelsey Grammer - star of such TV hits as Cheers and Frazier, was awarded $40 million in settlement when she separated from him after 14 years of marriage.

The Italian media tycoon and once Prime Minister of Italy Silvio Berlusconi is said to pay a cool $4 million a month alimony to his ex-wife. Now that is what you call an alimony!

But these are extreme exceptions. When income can sometimes be barely enough to support a single household pre-divorce, spousal support or alimony can become a main source of resentment following a divorce.  

The responsibility to suddenly support two households can be an extraordinary financial burden. And for the recipient of the payments, it can also mean a more restricted lifestyle than the one that they had become accustomed to. 

What Factors Determine Alimony?

Spousal support (also known as alimony) is meant to help the recipient maintain a certain level of financial security after divorce. Alimony is considered enough when it is able to ensure that the recipient’s standard of living is maintained and does not suffer a downgrade after divorce. 

In determining how much spousal support to grant, a judge considers several factors. He or she usually reviews the receiving spouse’s need for the funds to meet basic expenses, as well as the paying spouse’s ability to make the payments. The factors that the judge considers to make a decision are:

  • Income Need / Capacity to earn an income

The important thing that the judge will consider is if the recipient has enough money to live on. He or she will also look into the recipient’s ability to earn an income as well as the marital assets of the spouse seeking support to ascertain if he or she can use these assets as a source of economic support.

  • Capability to Pay

On the flipside, the judge will also consider the payor’s capability to pay and yet still have enough to support the standard of living that he or she is accustomed to. 

  • Duration of the marriage

The length of the marriage is also a factor when the judge awards spousal support. If the marriage lasted for two years, for instance, it is possible that no spousal support will be granted. 

In California, the general rule is that spousal support is granted for half the length of the marriage for marriages lasting less than 10 years. In marriages that last 10 years or longer, the court does not set the duration of the alimony. The burden is on the spouse who is paying to prove that alimony is no longer necessary at some point in the future. 

  • The needs of each spouse based on the standard of living during the marriage.

Here is where the importance of hiring, not just a divorce lawyer but also a Certified Divorce Financial Analyst® to assist you, becomes apparent. Divorce can be such an emotionally draining experience, that just to get through the process as quickly as possible, it is easy to agree to an alimony amount that is less than what is really needed.

A CDFA® reviews the financial situation of both parties and makes a projection for the future that include all expenses, income, assets and liabilities. With a clear financial picture, it becomes easier to determine an alimony that would be beneficial for both parties - one that would ensure that the divorcing couple will be able to thrive financially after the divorce.  

Kimberly Surber Divorce Financial Analyst Can Help

At Kimberly Surber Divorce Financial Planning, we help you gain financial empowerment during divorce and for your future.

Here is what we offer:

  • Assistance in preparing and consolidating your financial statements so you have a clear understanding of your financial life.

  • Help in preparation of a realistic budget to live on before and after divorce

  • Help in understanding important matters such as child support and alimony so you make the best financial decisions for your future.

  • Proposal of alternative settlement options

  • If necessary, act as an expert witness of financial issues if the divorce case goes to trial

Divorce should not be a cause for your life to grind to a stand still. With the help of Kimberly Surber Divorce Planning, we can offer you competent financial advice so you can move from just surviving to truly thriving! Call us today for a free consult: 907-347-3860.

Tags: spousal support, alimony, settlement, CDFA, Certified Divorce Financial Analyst, alimony amounts, assets, length of marriage, factors

This information is not intended to be a substitute for seeking legal advice from an attorney. For legal or tax advice please seek the services of a qualified attorney and/or qualified tax professional.

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Kimberly Surber is a Certified Financial Planner®  and a Certified Divorce Financial Analyst®; however such registration does not imply a certain level of skill or training and no inference to the contrary should be made. Information presented is for informational purposes only, does not intend to make an offer or solicitation for the sale or purchase of any securities, and should not be considered investment advice.  Kimberly Surber has not taken into account the investment objectives, financial situation or particular needs of any individual investor. There is a risk of loss from an investment in securities, including the risk of loss of principal. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment will be profitable or suitable for a particular investor's financial situation or risk tolerance. Asset allocation and portfolio diversification cannot assure or guarantee better performance and cannot eliminate the risk of investment losses. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed here. Past performance is not indicative of future results. Investments involve risk, including loss of principal and unless otherwise stated, are not guaranteed. Information provided reflects Kimberly Surber's views as of certain time periods, such views are subject to change at any point without notice. For a copy of our Privacy Policy, see below.

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