What’s a fair financial arrangement with my spouse while my divorce is pending?You’re miserable in your marriage, but one of the issues keeping you up at night is whether you can even afford a split! How much will you have to pay in alimony or child support? Will you be able to afford to live decently with all that money going out every week?
One of the most important aspects of planning for divorce is determining whether you’ll be on the hook for support and paying the bills, and if so, how much. The main issues that must be analyzed are: do you have children, and if so, what’s the plan for a parenting arrangement? What are yours and your spouse’s respective incomes and financial needs, and how long were you married? And finally, are there marital assets that require payments for upkeep and maintenance, and if so, who’s responsible for what, and how much will that cost?
Once the case is filed, either party can file a motion with the court asking the court for an order addressing issues of custody, support, and payment of bills, among other issues. However, if you can implement a fair arrangement in advance, you may be able to reduce your litigation costs, gain momentum in negotiations, and set a precedent for a favorable outcome for your case.
If a separation is on the horizon, you should give a lot of thought to what the parenting arrangement will be for the children. In addition to the obvious importance of spending as much time as possible with them, there are significant financial ramifications connected to your parenting plan.
Child support is calculated pursuant to the MA Child Support Guidelines, which uses a formula that essentially considers the parenting arrangement for the children, gross incomes, health, dental, and vision insurance costs, and work-related child care costs of the parties, and costs for other children who are not parties to the case.
The significance of the parenting arrangement is generally that the more time a party spends with the children, the lower the risk and amount of child support. However, there are some limitations. If one party has roughly two-thirds of the parenting time, and the other party about one third, a few hours of parenting time in either direction is unlikely to make a difference. On the other hand, if one party has the children all of the time (and is, therefore, incurring all of the costs) or if the parties have approximately shared parenting time (and therefore sharing many costs), those circumstances are more likely to impact the child support order.
Once you have an idea of what your parenting time will look like, you can calculate child support.
Do I have to pay alimony?
First, if there’s a child support order and the combined gross income for both parties is below $250,000, it’s unlikely there will be an alimony order in addition to child support. However, if there are no children involved, there’s a significant disparity in your respective incomes, and you’ve been married and/or living together a long time, the risk of alimony is greater.
There are a number of factors the court uses in determining whether to order alimony and how much: the length of the marriage, incomes of the parties, health, age, other assets, prospects for future earnings and acquisition of property, to name a few.
If alimony is likely, you can estimate the amount. Alimony is primarily based on the lower earner’s financial need and the higher earner’s ability to pay. It’s usually calculated at the lowest of the need or 30-35% of the difference of the parties’ gross incomes. This will give you an idea of the potential alimony amount.
Who’s responsible for what bills?
Who pays for what while the parties are working out their divorce issues depends on the parties’ incomes, other financial obligations, and where they’re living. Generally, the party staying at the marital home is responsible for its costs. However, if that party’s income is low, the other party may be ordered to contribute.
For example, if a low-income earner is living at the marital home, the other party may be ordered to pay half or even all of the costs. Same principle applies to auto expenses. The party driving the car is usually responsible for its costs, including loans, taxes, and insurance. But someone earning very little may require help from the other to pay for the bills.
The parties typically pay their own education loan and credit card payments, but this too, ultimately depends on the available income for each party.
Importance of Planning
Planning up front for support and payment of bills while a divorce is pending can save you money and increase your chances of a good outcome.
You should gather as much financial information as possible about assets, liabilities, and income. As soon as you believe divorce is on the horizon, you should reach out to a reliable lawyer to help you develop a plan for handling these financial issues. Failure to plan may result in the other side filing a motion with the court, which will cost you time and money.
If you come up with a fair but favorable arrangement up front, it will not only possibly avoid the unnecessary costs associated with an extra hearing, but it may also provide you some momentum for resolving your case. If your spouse sees that you’re willing to work these issues out reasonably, you’re more likely to resolve the other issues effectively.
Don’t bury your head in the sand and hope these issues will work themselves out without planning and effort. Get ahead of the game with a quality plan that will put you on track to a favorable and efficient outcome.