Alimony is a tool we can use in your divorce to give you the financial boost you need to get on your feet after a divorce. It buys you the time you need to obtain additional education or training and/or to reenter the workforce and become financially self-sufficient. It can also be a way to attempt to mirror the marital lifestyle for a dependent spouse. Follow these tips to benefit the most from your alimony payments.
- Have a financial plan. Once you know how much alimony you will receive, create a budget for your household. If you are also receiving child support, this will be part of your budget as well. Your goal is to create a spending plan that will allow you to live independently while you make strides to better your employment opportunities if you can. Living within your means is extremely important.
- Do your research. Find out exactly what it will cost to go back to school or obtain the training you need. Learn what kind of entry level pay you can expect to earn in the position you are working towards.
- Don’t view your alimony as a windfall. This is money you need to secure your future. You may only receive alimony for a specified time, so make the most of it while you receive it and do everything you can to make it an investment that will pay off.
- Understand the tax consequences. Alimony is considered taxable income for the spouse who receives it. This could increase your tax payment for the year, so it is a good idea to talk to your tax preparer and understand what you will owe, and then save that portion specifically for your taxes, or increase your withholding on other income to compensate.
- Have a Plan B. Talk to your divorce attorney to find out what to do if your ex ever misses a payment or is routinely late with payments. You may be able to have payments withheld from his or her pay and sent to you directly.
DeTorres & DeGeorge handles alimony and post-decree enforcement in New Jersey. Your future is our focus.