How Is Alimony Calculated?

If there ever was a million dollar question, this is it. There are three basic answers to the question: 1) How it should be calculated, 2) How it is generally calculated, and 3) How it is sometimes calculated.

Alimony should be calculated using the factors as set forth in:

  • the requesting spouse’s actual needs and the other spouse’s ability to pay
  • the duration of the marriage
  • each spouse’s age and physical and emotional health
  • each spouse's income, earning capacity, education level, and employability
  • the standard of living during marriage
  • parental responsibilities
  • the time and expense necessary to obtain education or training for the dependent spouse to become self-supporting, and
  • each spouse’s financial or non-financial contributions to the marriage.

Again, that's how alimony should be calculated. Of course, those factors probably give you little to no guidance.

How most lawyers calculate alimony is that we start with marriages of about 5 years and longer. We then look for a disparity in income. How much of a disparity is up for debate, but it has to be more than just a slight disparity. Of course, it is all relative. There will likely be alimony for a couple making $40,000 and $20,000 but probably no alimony for a couple making $240,000 and $220,000. Once we have all of that, the rule of thumb in New Jersey to take the 1/3 the difference in gross incomes. Let's use the income figures of 60,000 and 30,000 for the two spouses. The difference is $30,000 and 1/3 of that is $10,000. Thus, that will be the starting point for alimony discussion.

The next step is to determine the length of alimony. For cases not involving permanent alimony, lawyers generally use one-third to one-half of the length of marriage. Thus, for a 10 year marriage, the alimony term will be 3 to 5 years. If the marriage is at least 20 years, permanent alimony is clearly on the table. Between 10 and 20 years, its up for debate depending on the facts of the case.

How Alimony is Sometimes Calculated

The rule of thumb outlined above is just that, a rule of thumb. You won't find any law on the subject. In fact, there was a case that addressed this rule of thumb and specifically shot it down. Nevertheless, it continues to be used. Since it is not a real law, there is no way to really enforce it. There are a number of factors in any given case that can cause the lawyers, a mediator or a judge to deviate from this rule of thumb. This has resulted in some very expensive legal bills for many people. Sometimes, those people run out of money to pay their attorney and must therefore except whatever it on the table at that point. This is clearly less than what they would have received or more than they would have had to pay, depending on who is the one running out of money.

Another problem is that people are often scared of trial. The fear of the unknown is great. Fear of what the judge will decide and fear of how much it will cost to get there. Some lawyers also fear trial and therefore pressure their clients to accept a bad deal. In these cases, there may be little to no thought given to calculating alimony. It simply comes down to what the parties are pressured into accepting.

With all of the above being said, one can see the need for alimony reform. Click on the alimony reform link above to read more about that movement.

Call us anytime.

Free initial consultation. All major credit cards accepted.