If you are going through a contentious divorce process, then be sure to build in all the safeties you can to secure your hard-won settlement. Here’s how life insurance could hold the key to some of your concerns around the divorce settlement and your financial future.
Why you need a fail-safe guarantee
For someone who is a dependent spouse, relying on the alimony payment from a now-estranged spouse can be a nerve racking experience. This is made even more daunting when old age creeps up on you, or if your ex has a host of health problems or lives on the edge. Even without all these risks, the loss of your estranged ex will mean that your alimony payments stop completely with no one to make them. Often, after a divorce, couples will revise their wills to exclude the ex from inheriting their estate – whether it is property or other assets. There is however, one way to ensure you don’t find yourself in a spot when a spouse passes on.
Life insurance and how it can help
If you do not earn an income, and are totally dependent on the money that comes in as alimony, you may find yourself with no money in the bank when your ex dies. Life insurance can help give you a payout on their passing which will see you through.
Term insurance vs. whole life policy
A term policy covers the life of the insured individual – your ex – for a fixed duration of years. If your divorce settlement agreement dictates that payments will be made as child support until the kids are of a certain age, then it makes sense to have a term policy that runs for that duration only so you pay lower premiums. A whole life policy also has an investment component with some returns on the premium paid besides the death benefit.
Who pays?
Many couples have life insurance policies when they are married, but after divorce the earning spouse may choose to stop making these payments. If they were the holder of the policy, they could even change the beneficiary. It is therefore important, as a dependent to be the holder of the policy and to ensure payments are made. You could work out so that premium payments are made by your spouse even if you are the holder, but in many cases the earning partner may not agree, especially if they are to make alimony payments. In such cases, it is well worth cutting the premium out of your own alimony received to keep up a policy or to take out a new life insurance policy on them. Think of it as an investment in your own future and financial security.
To learn more about the divorce process in California and how mediation can help, please visit our page, What is Divorce Mediation.
In a marriage, there is always one spouse that is more involved with running the house while the other is earning a major part of the income to cater to the needs of the family. Both spouses may also often be working alongside, yet one of them will have a higher earning capacity than the other. This is why alimony payments, also known as spousal support, is so important in an Orange County divorce. It is meant to provide financial stability to the lower earning spouse once the relation ends.
Even in Orange County divorce mediation, this has an important role to play. Here is the approach that Orange County divorce mediators should take in alimony discussions between spouses.
· Identify whether they have reached an agreement on it or not
Sometimes, spouses coming for mediation have already decided a number of issues amongst themselves. They merely use the platform of mediation to formalize what was discussed. If the spouses in front of you have decided on how the alimony payments will be made, then your job in this regard is almost complete. All you need to check is whether the payments are to be made yearly or monthly. If however, the agreement has not been reached, you need to encourage the parties to do so and highlight the importance of the process to them in the mean time.
· How long will the alimony be payable?
The intricacies of a divorce resolution must be known to the divorce mediator. They should ask questions and allow the spouses to fill in the gaps. For example, putting no limit on the alimony payment will be a disadvantage for the spouse making the payment. There are a number of alimony termination options as well which can be placed in the contract.
· Is one party in need of alimony and can the other party pay?
The most important question in alimony payments is quantifying the amount that the other spouse needs. On top of that, some spouses will also seek advice from the divorce mediator on whether or not the spouse seeking alimony deserves it. Yet, in all this, the mediator needs to keep in mind the fact that theirs is a role of facilitation only. The decisions need to be taken by the spouse and the mediator cannot give their opinion which may affect the decision.
To learn more about the divorce process in California and how mediation can help, please visit our page, “What is Divorce Mediation.”
Alimony payments are not all designed the same way, there are in fact, multiple ways a court or mediation specialist and attorneys could structure alimony payments. Depending on your specific situation and the needs of both parties, you may find yourself with an alimony order that’s temporary or permanent. Here’s a look at how the two differ and under what circumstances both may be enforced.
Temporary Support
Temporary alimony is usually given during the time the divorce proceedings are underway. It is created to help a non-working spouse or someone who needs the financial support of their partner, to get through the months leading up to the actual divorce when a more permanent solution will be decided upon.
When is temporary support granted?
This kind of alimony or spousal support is typical of the period of separation or in cases where the marriage annulment has been applied for, besides the more conventional divorce proceedings stage. A document called the Request for Order is to be filed at the local family court, after which both spouses must then submit Income and Expense Declarations. This declaration contains all financial information on each of them and is used to determine the financial status and needs of each spouse. While there are specific guidelines in place in each state, the exact case is dealt with at the discretion of the court where the financial motions are filed. The court may choose to not grant temporary support or temporary alimony at all, and in cases where alimony is granted temporarily, the terms are decided by the court.
Permanent Alimony
Once a divorce proceeding heads to its final stages of closure, the court will decide whether the particular case requires conditional/short-term alimony to be granted or if a more permanent solution is required. The latter is usually chosen if one spouse has no income and the duration of the marriage is suitably long. It is also up to the divorce attorney of the spouse seeking alimony to ensure all necessary documentation is presented to support a case for this kind of permanent alimony. If one partner has given up their career to support the marriage and bring up the kids and will find it near impossible to get back into the workforce, it could make a case for permanent alimony. Ultimately however, whether or not permanent spousal support depends on the negotiation powers and prowess of your divorce attorney and the discretion of the judge.
The connection between temporary and permanent alimony
No matter how extensive the background work was in determining the temporary alimony, this is not used to ascertain the terms of the permanent spousal support. In essence, permanent and temporary alimony are two completely separate court mandated orders. One does not have bearing on the other.
To learn more about the divorce process in California and how mediation can help, please visit our page, “What is Divorce Mediation.”
Alimony/spousal support payments to be made after a divorce, by one spouse to the other, are designed to help the partner who is in need of the financial help, lead a life that is somewhat comparable to the circumstances prior to divorce. However, there are some important things to know about spousal support:
Alimony payments are dictated by need not income
You might believe that you are owed a certain amount by your spouse because they are earning far more than you are, or because you have invested a lot of time and lost out on career opportunities for the sake of your marriage. The reality however, is that the judge will make a decision on what amount you get as spousal support based on a dozen or so factors, depending on which state you are in. And one of the key factors that will come into play will be the perceived need of the spouse who is to receive the payment. Even if your spouse works, you may still have to pay alimony.
Payment of alimony may not be forever
There are a number of different kinds of spousal support, including something called short-term or rehabilitative alimony. This is designed to help one spouse tide over the initial phase after a divorce, where they need the help while they get their finances and life in order. Other kinds of alimony may also cease to be due, if the recipient moves in with a new partner or remarries.
The duration of your marriage matters
When it comes to alimony, the duration of the relationship also comes into play. The same couple going through a divorce after just 2 years of marriage will see a very different outcome and quantum of alimony being payable, compared to a couple that has been together for a couple of decades or more. That’s because the investment in the marriage and the opportunity cost for the spouse earning a lower income as a result of decisions taken to support the marriage, is greater.
You can take legal action if your spouse doesn’t pay up alimony
Once you have an alimony order, your spouse is required by law to give you the required payments as dictated. However, if they fail to do so, you could choose between undertaking an ‘earnings assignment order’ or a take out a ‘contempt’ proceeding. In extreme cases, if no payments are made in spite of a court order, the court could even put your ex in prison to get them to fall in line.
The role kids play in determining alimony
If your soon to be ex is the one with the primary care-giving responsibility for your kids and will continue to look after them after your divorce, the court will, in addition to the child support payments, also likely mandate a longer duration of spousal support. This is done so that he/she can find help and return to a full-time or regular job which they may not have had to do within the marriage. The extra time helps gives them the flexibility to re-qualify and hunt for a job.
To learn more about the divorce process in California and how mediation can help, please visit our page, “What is Divorce Mediation.”
If you find yourself faced with divorce proceedings after your your spouse found out about your relationship or fling with someone else, you’re probably wondering how much this can affect your settlement. Handled carefully, you don’t need to be taken to the cleaners for your indiscretion. First off, it helps to understand the ramifications of adultery on a divorce – both financial and legal.
Not all states treat adultery alike
The law varies depending on where you are. Understand the intricacies of divorce law and the impact on your settlement with the help of your divorce attorney. In some states like California, adultery has little or no bearing at all on the divorce. If you live in a no-fault state like California, then you should be able to proceed as normal and no proof of adultery will be demanded.
How adultery impacts Spousal Support or Alimony
If you are the one accused of adultery in a no-fault divorce state like California, there is generally no impact on the ability to seek spousal support. However, if cohabitation with that person occurs, it can affect the amount and/or ability to obtain spousal support.
Division of Financial Assets in a divorce involving Adultery
How the financial assets are divided and the terms of the settlement are in general, not influenced by whether or not one partner or both have committed adultery. The only instance where it could come into play is if the family’s finances and assets were impacted or utilized for supporting the adulterous relationship. In case the family wealth was eroded to support this relationship, the betrayed spouse will make a bid for some form of compensation.
Special circumstances
In case you contracted an STD and passed it on to your spouse, you may find yourself vulnerable to personal injury action lawsuits. It is therefore, best to come to an agreement within the purview of the divorce proceedings and settlement and prevent things from getting out of hand.
Ultimately though, the divorce settlement will be most influenced by your own emotions, guilt and feelings towards your soon to be ex spouse. If you are feeling bad about what you did, you may agree to give in a little more and let your spouse get a better deal.
To learn more about the divorce process in California and how mediation can help, please visit our page, “What is Divorce Mediation.”
Gerald A. Maggio is a trained divorce mediator who has amicably resolved cases many cases out of court, as well as an experienced divorce and family law attorney. Mr. Maggio founded California Divorce Mediators in 2012 with the belief that although “not every marriage can be saved, every family can” and a mission to save families from the financial and emotional distress associated with traditional divorce litigation. California Divorce Mediators is located in Irvine, California, and serves the Orange County area and other counties in California offering divorce mediation, child custody mediation and mediation of other family law matters.
Spousal support/maintenance is something that most spouses that are in a better economic state to their other spouse will have to pay once they decide to part ways. The idea of spousal support which is also known as alimony is designed to make sure that the dependent spouse in the marriage is protected during and post-divorce.
Determining spousal support in divorce can be complicated as there are various techniques that judges use to determine the amount of spousal support. Generally people who through a litigated divorce will be given out formulaic approach for support orders that have a stark disregard of the situation of the couple, and instead focus on black and white procedural rules.
A Comfortable Way Out
While the courts must stick with the rules and set precedents in deciding a spousal support order, people who go to divorce mediation will have the chance to getting their spousal support decided rationally.
The rational approach is a popular approach that most spouse uses with one another when deciding their post-divorce alimony payments. Use of this approach typically leads to a more just settlement that is closely modeled on the current economic situation of the parties.
The Rational Approach
The rational approach derives its concept from the word rational which loosely translated means reasonable. If you are considering divorce mediation in Orange County with your spouse, looking to make use of this approach, here is a lowdown on how it works.
The process starts with a detailed analysis of the living expenses that can be reasonably associated with each party. It is important at this stage that the two parties don’t get into a futile argument as to what expense to keep and what to leave.
If you think that you have a legitimate claim to some expense that needs to be added in your reasonable expense list and your spouse should accept it. It is advisable that you carry a credit card, a monthly bank bill of the withdrawals of cash made each month and the monthly receipts of items you regularly need in your life. If you are able to show all of the evidences your case in front of the other party will strengthen, more often than not compelling them to agree to your assertions.
The rational approach will usually divide the spousal payments into multiple schedule lines, easier for the spouses to divide amongst each other. The common factors that need to be taken into account before deciding on the rational approach spousal maintenance are:
Monthly payment of spousal maintenance
Gross monthly income covering all sources
Total expenses that incurred monthly
The total monthly income with respect to adding of spousal maintenance received and subtraction of spousal maintenance paid.
The total number of taxes that have been paid by each party off their incomes
Net income that is left remaining post payment of taxes and deduction of expenses.
To learn more about the divorce process in California and how mediation can help, please visit our page, “What is Divorce Mediation.”
Do you want to get your child custody and support agreements made? Are you looking for an attorney to litigate it for you? Before you do that though, consider getting the services of a divorce mediator. A large number of parents who tend to go to litigation are left wanting and disappointed at the child custody and support orders that courts give. The best way to avoid this feeling of ‘what if’ or ‘it could have been better than this’ is for the parents to erase the court out of the picture and do it themselves.
How? Divorce mediation services and mediators can help you through the mediation process to develop your child custody and support orders.
The Money Game
Courts are likely to focus their approach to try and split the child custody and child support costs. The formulas for this are likely to be the ones that are mandated. There is little or no chance of deviation from those principles that have already been agreed upon. Yet in divorce mediation, the mediator will facilitate the parents but ultimately leave the final decision of the costs and the finances splitting on them.
Child custody, on the other hand, is likely to be a trickier subject, since the custody of one’s child is what both the parents desire and it is likely to have a host of emotions attached to it. However, divorce mediators are skilled professionals who are likely to be able to address the emotional side of things and yet allow the parents to reach a mutually agreed upon child custody arrangement where both the parents get what they want more or less.
Another advantage of this method is the fact that when parents mutually agree upon support payments and child custody arrangements, they are likely to honor it more willingly than they would do to a court order that is imposed on them which they aren’t particularly content with.
Adversarial is not a Word to Describe Mediation
The key to mediation is going into it prepared and knowing what you want out of the process. Having said that, however, it must be noted that mediation is a process where you are required to make concessions and so flexibility in your plans is a must. The one thing that should be the top priority in a mediation agreement being developed is the best interest of their child. Children should come first in any agreement being made with their rights and future being guaranteed first and foremost.
Look to the Future
The process of Orange County mediation is all about looking towards the future. Mediation is a process not only helps you develop a better future for your child, it makes sure your emotional trauma side is kept as far away as possible.
To learn more about the divorce process in California and how mediation can help, please visit our page, “What is Divorce Mediation.”
Gerald A. Maggio is a trained divorce mediator who has amicably resolved cases many cases out of court, as well as an experienced divorce and family law attorney. Mr. Maggio founded California Divorce Mediators in 2012 with the belief that although “not every marriage can be saved, every family can” and a mission to save families from the financial and emotional distress associated with traditional divorce litigation. California Divorce Mediators is located in Irvine, California, and serves the Orange County area and other counties in California offering divorce mediation, child custody mediation and mediation of other family law matters.
Did you just get a divorce? If your divorce was finalized a few months back, the headache of filing for taxes may have already fallen upon you. New divorcees will get to experience all of it for the first time, i.e. filing tax returns and dealing with new tax issues. Here are five things to know to reduce the anxiety that comes with filing taxes:
1. Figure Out Your Filing Status
Determine the date the judge finalized the divorce. If your divorce was finalized by midnight on December 31st, you will generally have to file your tax returns separately. If your divorce judgment was entered after January 1st, you have the option of filing “married filing jointly” (if your spouse is agreeable and it makes sense to do so) or “married filing separately.” If you share custody of your children, you will generally get to claim head of the household status.
2. Child Support Payments vs. Spousal Support Payments
It is very important to know that people who pay alimony are entitled to write those payments off as a tax deduction, and those receiving spousal support must claim it as “income” on their tax returns. Therefore, both parties should plan their tax obligations accordingly. On the other hand, those paying child support cannot claim such payments on their taxes as a deduction, and those receiving child support do not need to report such payments on their tax returns.
3. Determine Who Gets the Child Exemptions
During divorce proceedings, you and your partner can decide on who gets qualified to claim the child/children as tax exemptions. If you have joint custody (i.e. 50% each), then generally you should agree to alternate the right to claim the tax exemption each year. Otherwise, the party who has over 50% custody gets to claim the child as a tax exemption pursuant to the IRS Code.
4. Change Your Withholding on the W-4 Form
You can claim extra tax exemption on your W-4 form through your employer to offset the tax deduction for spousal support payments you are making, leaving you with more net income each month. On the other hand, people who receive alimony payments can ask their employer to withhold additional taxes from their paycheck to cover their new tax liability.
5. Review the Legal Fees
If you filed for divorce using the litigation method, you might have significant legal fees incurred. Unfortunately, most legal fees are not tax-deductible, but fees that you paid for advice regarding taxes are.
To learn more about the divorce process in California and how mediation can help, please visit our page, “What is Divorce Mediation.”
There are 2 types of spousal support orders in California. First, there are temporary spousal support orders made while a divorce or legal separation case is pending, which are generally made in the initial stage of such cases until a final resolution of the case is accomplished. Second, spousal support orders made at trial of trial or by a stipulated Judgment reached between the parties are generally termed “long-term” spousal support orders intended to kick in once the divorce or legal separation is finalized.
In California cases, long-term spousal support orders can be amended or terminated under certain circumstances. Supporting partners have a number of different options available to them, if they wish to pursue a modification or termination of the support they provide.
In most cases, long-term spousal support can be terminated or modified at any time during the support period. The only instance when this is not true is when there is a written agreement by the parties expressly stating that spousal support is non-modifiable. In the absence of such an agreement, the court generally retains continuing spousal support jurisdiction and can decide to terminate or reduce spousal support in later court proceedings. This is especially true for marriages that were more than 10 years in duration.
If the court assumes continuing spousal support jurisdiction, then the court may grant a request to modify spousal support if the supporting party can demonstrate a material change of circumstance since the most recent court order outlining the spousal support. When reviewing a modification or termination request, the court will consider the following factors:
Reducing Support if Spouse is Self Supporting– The California Family Code emphasizes that even in long-term marriages, defined as those which last 10 years or more, the supported spouse has a duty to become self-supporting within a reasonable amount of time, which is considered to be one-half the length of the marriage. Generally, if the duration of the marriage is less than ten years, a supported spouse is expected to become self-supporting in half the length of the marriage. Modification or termination of the support can be ended before this time. If the spouse has not made any reasonable efforts to become self-supporting, you may ask the court to terminate the spousal support. If, on the other hand, your former spouse has actually increased his or her earnings, you will be able to present evidence of this in court and argue that he or she now has a reduced need for support.
Reducing Spousal Support Based on Obligations– In some cases, the supported party’s separate estate, including any and all assets allocated to him or her in the community property division, and its reasonable income potential, may be enough for you to seek a reduction or termination of previously awarded spousal support.
Other Factors that affect Modification of Spousal Support include:
Remarriage– A spousal support order automatically terminates when the supported party gets remarried.
Cohabitation– Cohabitation may also be a basis for seeking a modification or termination of a spousal support order. If your former spouse is cohabitating with a member of the opposite sex in a romantic relationship, you can request that the court order a termination of support or a downward modification of support.
Retirement– The retirement of the supporting party may be sufficient basis to receive a termination of support; however, it will be important to prove that the supporting spouse has a right to retire and is not choosing early retirement. In California, the recognized retirement age is 65, meaning that your ex-spouse cannot force you to work beyond that age, and if your retirement income is less than your pre-retirement income, you are likely entitled to a modification of the spousal support order at a minimum.
Whether you can terminate or reduce your existing spousal support obligation depends upon the unique facts and circumstances of your case. If you are considering modifying or terminating your spousal support order, you should contact a family law attorney who will review your case and advise you on how best to proceed.
For more information or to schedule a consultation, please contact California Divorce Mediators at (949) 553-0911 or at www.cadivorcemediators.com.
To learn more about the divorce process in California and how mediation can help, please visit our page, “What is Divorce Mediation.”
If you are going through a contentious divorce process, then be sure to build in all the safeties you can to secure your hard-won settlement. Here’s how life insurance could hold the key to some of your concerns around the divorce settlement and your financial future.
Gerald A. Maggio is a trained Orange County divorce mediator who has amicably resolved cases many cases out of court, as well as an experienced divorce and family law attorney. Mr. Maggio founded California Divorce Mediators in 2012 with the belief that although “not every marriage can be saved, every family can” and a mission to save families from the financial and emotional distress associated with traditional divorce litigation. California Divorce Mediators is located in Irvine, California, and serves the Orange County area and other counties in California offering divorce mediation, child custody mediation and mediation of other family law matters. 
