Spousal support, also known as maintenance or alimony, becomes a critical issue in maintaining one's lifestyle during and after the divorce process. Spousal support considers many facets, including an attempt to keep both spouses within their accustomed lifestyle. Maintaining a lifestyle can be complex in any divorce, but it presents specific problems when there are significant assets involved.
This article focuses on the concept of standard of living in a divorce, specifically on how this legal concept impacts high net worth families.
Factors Courts Use to Determine Spousal Support
Courts use several factors to determine spousal support, including:
The Length of the Marriage
Longer marriages often result in higher support.Contributions to the Marriage
Courts recognize efforts like homemaking or child-rearing, even without financial income.Any History of Domestic Violence
Victims might receive higher support.The Age and Health of Both Parties
Younger or healthier individuals might receive less support as they have a greater chance of becoming self-sufficient.The Earning Capacity of Each Spouse
Higher earners might pay more support.The Needs of the Spouse Seeking Support
Courts consider each spouse’s expenses in living separately.The Standard of Living During the Marriage
Courts aim to keep both spouses within a similar lifestyle post-divorce.
How Courts Determine the Standard of Living
Courts assess the standard of living during the marriage by examining lifestyle aspects, such as:
The house and its location
Any vehicles the spouses owned
Clothing and personal care expenses
The overall financial habits of the couple
Healthcare expenses and insurance levels
The frequency and nature of vacations
Household expenses, including utilities and services like housekeeping
The quality of education for children, considering private schooling or extracurricular activities
The type and frequency of entertainment spouses enjoyed, such as dining out or attending events
Difficulties for High Net Worth Divorces
The Standard of Living Applies to Both Spouses
Keeping each spouse within their accustomed lifestyle becomes complex. Courts must balance diverse financial needs and assets. Each spouse may have different earning capacities and financial obligations. This process requires thorough evaluations, detailed documentation, and reasonable projections for each spouse’s financial future.
The Standard of Living Is Open to Interpretation
Evaluations try to capture the true marital lifestyle, but interpretations can vary. For instance, judges might view luxury expenses differently. Some may believe that these costs should remain part of spousal support, but others may consider them unnecessary.
Leftover Resources
In theory, the richer of the two spouses could afford to keep the other within a certain lifestyle, and they could have plenty of resources left over for themselves. This outcome may seem unfair to the receiving spouse. They may want more of these leftover assets, believing that having them is a more equitable solution.
This dynamic creates a challenging environment. The recipient spouse must understand that the court is only going to award spousal support based on financial need, and not on a future nest egg.
Alternatives to Courtroom Decisions
Couples can negotiate their own spousal support settlements, taking control of their future without being at a judge’s mercy. It is important to fnd a well-respected matrimonial law firm, like Samuelson Hause PLLC, will help you amicably negotiate a settlement. Mediation is also an option, which involves a neutral third party helping both sides who are represented by counsel to agree on a spousal support package.
Samuelson Hause PLLC is here to help protect your assets in a high net worth divorce. To meet with our team, contact us online or call our office at (516) 584-4685.