Want to provoke powerful emotions and painful stories? Write about alimony.
That's what I learned after publishing "Alimony Is Broken —But Let's Not Fix It." My e-mail inbox was flooded with strong reactions and personal stories of deep pain, dredged up for a combination of reasons: outdated state laws, confusion concerning alimony's purpose, and courts' inconsistency in awarding it.
There's a historical basis linking emotions and alimony. In earlier times, divorce could stem only from marital misconduct. As a result, the requirement to pay alimony became linked to the factor of guilt. Alimony was the right of the state to penalize publicly a guilty spouse who broke bonds of matrimony. No-fault divorce laws eliminated the right to alimony and replaced it with an entitlement system that better reflects socio-economic events and progress.
Alimony usually is the last piece of the financial puzzle to be finalized in divorce, following child support and division of assets. Because alimony closely follows the gamesmanship surrounding these other issues, alimony itself — the amount due annually and the length of time it's paid — is unpredictable.
Alimony laws in many states are flawed and deserve reform; some states do not put a time limit on alimony, and others make alimony nearly impossible to attain. People sometimes shop for a favorable state in which to divorce, simply to gain financial advantage. Individuals who want to cheat or defeat the system will find a way to do so, no matter what the law or their divorce decree mandates. Alimony modification and enforcement are costly efforts subject to complications and errors, and they don't guarantee compliance with either the intent of the original agreement or subsequent circumstances.
But the hottest hot button driving most alimony reform is lifetime alimony. Both parties, whether they're receiving or paying, feel shackled by a legal obligation that fails often to produce financial remedy and finality for the long term. To paraphrase the opponents of lifetime alimony: It is welfare, it is goldbricking, it enslaves payors for the rest of their lives, and it unfairly impacts divorced spouses and their entire families.
It is vitally important that proposed reforms must not be a knee-jerk reaction that swings the pendulum from one extreme to the opposite extreme. Proposed reforms have to address many factors of alimony. This will take a long time to test, gain a consensus, and finally, be enacted into law.
A reform movement by its nature depends on social movement with people influencing judicial application to mirror public desires. The defenders of laws have a duty to deliberate all nuances relating to content and context of proposed changes in the law. This sets up the dynamic for lengthy debate and slow changes in law. This is how most states adopted eventually no-fault divorce and all states accepted uniform child support standards. “Smart” laws are meant to eliminate never-ending litigation and fear of the unknown.
Steve Hitner, a Massachusetts businessman who divorced and later remarried, led the Massachusetts Alimony Reform Act that went into effect in March 2012. The law abolished most lifetime alimony. It ended alimony when the payor reaches age of retirement or when the recipient begins sharing a common household with a partner. The law provides guidelines and structure, consistency and predictability for divorce. It also provides for judges' discretion in exceptional cases as well as for modifications of prior lifetime alimony cases.
In my recent conversations with Steve, he described the eight-year process of getting the law passed as challenging for both lawyers and the public. Not everyone is happy with the Act. Judges want clarification, attorneys see more people avoiding litigation to negotiate settlements, and still others want to continue to appeal its meaning. I asked Steve why other states were not rushing to adopt comparable reform laws and his response was that this is a social policy change that they may feel uncomfortable with. “The Massachusetts legislation establishes the correct public policy of encouraging parties to terminate their relationships upon divorce and live independently as soon as is practical,” Rep. John Fernandes, a Milford Democrat and House Chairman of the Alimony Reform Task Force, said during the debate.
One of my hopes is to incentivize adults to become fiscally responsible, knowledgeable and accountable for their own financial behaviors and decisions earlier in life. I want them to be full economic partners in their marriage. Men and women can be vulnerable to threats of the consequences of divorce; more often, they are prey for lawyers who extort significant fees from them by magnifying their hopes and fears. Alimony appears to be a lightning rod for all ailments related to these fundamental problems.
We have tools for targeting and measuring fiscal accountability. We also have a ripe teaching opportunity for spouses to embrace during divorce if they did not share financial experience, responsibilities, and decision-making during marriage.
And this is how a divorce financial planner brings critical expertise to supplement the legal process, in my opinion. Divorce financial planners help parties to determine if financial decisions are practical, achieve specific goals, and fit with spouses' needs and ability to pay. Among their contributions:
- Assessing current and future economic well-being
- Ensuring that costly financial mistakes are not made
- Performing projections of future cash flow and net worth
- Validating the accuracy of parties' lifestyle needs and ability to pay, so judges can apply their discretion in deviating from guidelines
This is the essence for creating and preserving a workable divorce agreement in which both spouses can return to their separate lives with dignity and security.
Vasileff received the Association of Divorce Financial Planners’ 2013 Pioneering Award for her public advocacy and leadership in the field of divorce financial planning. Vasileff is president emeritus of the ADFP and is a member of NAPFA, FPA, and IACP. She is president and founder of Divorce and Money Matters, serving clients nationwide from Greenwich, Conn. Her website is www.divorcematters.com.