How Retirement Affects Alimony
According to the Center for Retirement Research at Boston College, 50 percent of retirees will run out of funds before during retirement. For many, this means that they will have to rely on family, go back to work, sell their home, or apply for government assistance. None of these options is ideal, and having to pay costly spousal support is one way to quickly drain your retirement funds, putting you at risk of falling short in your latest, most vulnerable years. Similarly, if you are receiving alimony and can no longer work due to advanced age or forced retirement, it is in your best interest to request a modification for an increase in spousal support. A San Jose spousal support modification attorney can modify your alimony payments to more accurately reflect your new financial situation whether you are the receiving or paying spouse.
Retirement Must Precede the Modification Request
Alimony (spousal support) can be modified whenever there is a substantial, continued change in circumstances for either party. This goes both ways; the paying spouse can request a modification if the receiving spouse’s income rises dramatically, and the receiving spouse can request a modification if the paying spouse’s salary increases. But how does retirement fit into this? As the paying spouse, the modification request must be made after retirement, not before or even the week before. A modification request needs to be in reaction to changes in circumstances (your retirement) that have already occurred, not for something that is expected to take place in the future.
Pensions Are Considered Income
A police officer’s pension of $204,000 in Stockton grabbed headlines back in 2012, and while this number is drastically higher than most retirees’ pensions, it illustrates the fact that pensions do come into consideration for a retiree’s continued alimony payments. If the paying spouse has a pension, it will be factored into whether or not their request for a modification will be granted. Some pensions are 80 to 90 percent of what a retiree’s maximum salary was at the end of their career. Add that to part-time work, a new job, or consulting after “retirement” from the original career, and the paying spouse may, in fact, be obligated to pay more spousal support if the receiving spouse can prove that they need it and that the paying spouse has the means. Moreover, even if there is no pension and no more income from work coming in, a well-off spouse may be required to continue paying spousal support after retirement simply because their level of assets are so great, while the receiving spouse’s assets are not.
Reach Out to Our San Jose Law Offices Today
As the paying spouse, you should not have to pay the same amount that you were when your income was significantly larger while working, because continued spousal support payments are likely unsustainable for you. As the receiving spouse, your dependent on spousal support may increase if you are now retired, have a medical condition, or have additional expenses due to aging. Contact the office of Gemma V. Reyes to speak with a dedicated San Jose spousal support modification attorney today.