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Modifications & What You Should Know Before You Retire
If you are planning to retire, you are most likely wondering what happens to spousal support once you settle down. Do you still have to work to keep up with spousal support payments? Does spousal support terminate once you retire? Today, we discuss what you should know about spousal support as it relates to retirement and if reducing and/or terminating spousal support is possible for you.
The easiest way to determine if you must pay spousal support after retirement is to review the settlement agreement you made with your spouse at the time of your divorce. Spousal support payments often have a timeline for when your order will end or is subject to review. It could be possible that your agreement already states that spousal support will end after your retirement. Regardless, most of the time, retirement falls into the category of a Substantial change of circumstances and you can speak with an attorney about reducing or terminating your spousal support agreement.
Spousal Support Modifications & Termination
According to California law, a former spouse who is paying spousal support and eligible for retirement does not have to continue working to meet his/her spousal support payments. However, this does not mean that retirees can stop paying spousal support whenever they would like. To avoid violating the terms of your divorce, you must file a request for order for an order to terminate or modify your spousal support obligations. A lawyer can help you familiarize yourself with the factors impacting such motions.
Factors the Court Considers Before Modifying or Terminating Spousal Support
California courts can modify or terminate a spousal support order due to a material change in circumstance. If the paying spouse experiences one of the following circumstances, he/she can ask the court to review the existing spousal support order:
- If he/she gets injured and can no longer work
- If he/she experiences a sudden loss of income
- If he/she retires
- If his/her income is reduced due to retirement
- If he/she would have to work beyond retirement age to continue making payments
- If the receiving spouse is earning more, either by means of a division of a retirement plan or because the receiving spouse is now self-supporting
California courts will still refer to spousal support factors to determine whether they will grant your request for modification. These factors include but are not limited to the following:
- The duration of the marriage
- The needs of each spouse
- The paying spouse’s ability to pay based on his/her income, assets, and earning capacity
- The couple’s assets, property, and debts
- The needs of the child(ren)
- If there was any history of domestic violence
What Happens to Spousal Support After Retirement if Your Salary Is Reduced?
It is typical for an individual’s income to decrease once they enter retirement as he/she will not be receiving their normal salary, benefits, and/or bonuses. This factor alone is often a good reason for the court to comply with a request for a reduction or termination of spousal support, but, again, this depends on the case.
How Are Spousal Support Agreements Impacted by a Voluntary Retirement?
If you are voluntarily retiring at an earlier age, the courts may not feel this is a sufficient reason to modify or terminate spousal support payments. On the other hand, if you decide to retire involuntarily, possibly due to an illness or inability to work, the courts are much more likely to grant your request. Regardless of what you decide, we strongly advise you hire an experienced attorney to guide you through the process of modifying or terminating a spousal support agreement.
Does Age Affect a Spousal Support Payment Once You Retire?
Many couples wonder if their age will impact their spousal support payments. While this is not necessarily a determining factor, your age will affect Social Security benefits. In California, once you are 62 years old you are eligible for Social Security and you may have to share those benefits with your ex-spouse.
The guidelines for these circumstances are as follows:
- If your marriage lasted at least 10 years, your ex-spouse is unmarried, and he/she is at least 62 years old, you may be required to share your Social Security benefits.
Your ex-spouse can only receive these benefits if their own benefits are less than yours. Additionally, if your ex-spouse remarried, he/she cannot collect your Social Security benefits. It is also important to note that the retirement age is no longer 65 but between 66 and 67 depending on your date of birth.
What Happens if You Get Divorced After You Retire?
You are not exempt from paying spousal support because you got divorced during retirement. However, the courts will consider your retirement income as opposed to the income you had while working when factoring in what constitutes a fair spousal support award.
Consult with an Experienced Attorney at Our Firm
If you would like to discuss a modification in spousal support due to retirement, it would be beneficial to speak to an experienced attorney at our firm. If you are receiving spousal support payments currently, it can be stressful to learn your payment might be reduced in the future. If you are making payments, it can be overwhelming to think about continuing those payments with reduced income. We can help make sure you are financially secure in retirement, protecting your interests every step of the way.
Many people look forward to retirement, and we hope you feel the same. If you have any concerns about your finances as you navigate this stage of your life, consider us your helpful advocates.
Contact us online or give us a call at (818) 462-5076 to book a consultation today. We look forward to providing you with the advice and advocacy you need.