The Purpose of Alimony:
Alimony intends to maintain the economic status quo for a dependent spouse after divorce. Thus, if the husband earned more than his soon to be ex-wife; he will pay to ensure she has enough money to maintain the standard of living both parties enjoyed during the marriage. To be fair: under the law, the reverse is also true. That is to say, if the wife were the primary breadwinner, she would pay her ex-husband a stipend to ensure he can live as comfortably as during the marriage.
That two people can separate a maintain the standard of living they enjoyed during the marriage is plain claptrap. Separated, a couple’s expenses double while income often remains unchanged or declines as is the case when one spouse retires.
Historically, alimony drains the payor spouse and enriches the receiving spouse. Once established, an alimony award is tough to modify. Therefore, setting a fair amount of alimony and a reasonable duration for ongoing payments is paramount when a couple divorces. This article reviews the law and procedure to follow when the alimony payor retires.
New Jersey’s Alimony Law: Then and Now!
In New Jersey, current law presumes that spousal support should end when the paying spouse retires. That makes things easy if the divorcing couple can agree about the payor’s eligibility for retirement. But what if the payee objects to the payor’s retirement?
There are two considerations:
If the retirement issue is not settled in the divorce decree, the payor spouse must return to court for permission to stop paying the other party. He or she cannot just stop paying support. Recent case law indicates the payor should move the court for prospective relief approximately 12 to 18 months before their proposed retirement date. See Mueller v. Mueller, Unpublished N.J. Appellate Division.
The payee can rebut the other parties’ proposed retirement by producing evidence he or she can continue to pay. Thus, even in old age, a payor may find they are still obligated to work and support their former spouse.
New Jersey’s alimony statute, N.J.S.A. 2A:34-23, amended in September 2014, establishes the framework for litigating retirement in subsection (j):
New Jersey Alimony Orders entered before September 2014:
For alimony orders and agreements established before the September 2014 amendments, a retiring spouse can make a case for modification or termination of alimony under a changed circumstances analysis. This traditional test requires the court to consider whether the obligee has saved adequately for retirement and these additional factors:
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The age and health of the parties at the time of the application.
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The obligor’s field of employment and the generally accepted age of retirement for those in that field.
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The age when the obligor becomes eligible for retirement at the obligor’s place of employment, including mandatory retirement dates or the dates upon which continued employment would no longer increase retirement benefits.
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The obligor’s motives in retiring, including any pressures to retire applied by the obligor’s employer or incentive plans offered by the obligor’s employer.
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The reasonable expectations of the parties regarding retirement during the marriage or civil union and at the time of the divorce or dissolution.
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The ability of the obligor to maintain support payments following retirement, including whether the obligor will continue to be employed part-time or work reduced hours.
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The obligee’s level of financial independence and the financial impact of the obligor’s retirement upon the obligee.
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Any other relevant factors affecting the parties’ respective financial positions.
New Jersey Alimony Orders entered after September 10, 2014:
For orders entered after September 10, 2014, there is a presumption that alimony ends when the payor reaches “full retirement age.” Once the payor reaches full retirement age, the burden shifts to the spouse receiving alimony, who must show by a preponderance of the evidence that alimony should continue.
The critical difference between the old and new versions of the law is that once the payor reaches “full retirement age,” the burden of proof shifts to the party receiving alimony payments. (An obligor who seeks to retire before attaining full retirement age must demonstrate by a preponderance of the evidence that retirement is in good faith.)
