There’s More to Alimony than Standard of Living

In the State of New Jersey, when determining whether a litigant should be granted alimony, the courts must analyze and apply the fourteen factors enumerated in the alimony statute N.J.S.A. 2A:34-23:

1. The need of one individual for support and the ability of an individual to pay;
2.The length of the individuals’ marriage or their civil union;
3. The age and health of the individuals;
4. The standard of living established during the course of their marriage and the possibility that each individual can maintain a reasonably comparable standard of living, with neither party having a greater entitlement to that standard of living than the other;
5. The earning capacities, education, and employability of the individuals;
6. The length of time the individual seeking payment has been unemployed;
7. The parental responsibilities involving their children;
8. The time and expense that is needed to obtain adequate education and/or training to allow the individual seeking payment to acquire employment, the availability of the training and employment, and the chances for future acquisitions of capital assets and income.
9. The history of each individual’s contributions, either financial or non-financial, to the marriage or civil union, including contributions to the care and education of the children and interruption of personal careers or educational opportunities;
10. The equitable distribution of property and payouts on equitable distribution, directly or indirectly, out of current income, to the extent this consideration is reasonable, just and fair;
11. The income available to either individual through investments relating to any assets held by that individual;
12 . The tax treatment and consequences to both individuals of any alimony award, including the designation of all or a portion of the payment as a non-taxable payment;
13. The nature, amount, and length of pendente lite support paid, if any; and
14. Any other factors which the court may deem relevant.

Additionally, one other factor that the court may consider when determining an award of alimony at the time of trial is a savings component that the parties were able to sock away each month during the marriage. The goal of this savings component is to continue the financial status quo as far as savings (or as close as possible) for the spouse receiving support upon the entry of the judgment of divorce. But what if a savings component isn’t necessary where the dependent spouse’s share of equitable distribution, receipt of alimony, and child support enables him/her to continue to live a very modest middle-class lifestyle? Should the dependent spouse be entitled to continue to sock money away as the parties did during the marriage?

At the completion of trial, the court awarded the wife $7,600 per month in alimony finding that this amount, coupled with the investment income she could receive from her share of equitable distribution, receipt of child support, and earned income from her employment, would be sufficient to bridge the gap necessary to pay her monthly expenses. It is important to note that at the time of trial, the court determined that the parties were able to save approximately $87,000 per month.

The Appellate Division, in the published Lombardi v. Lombardi case, answered this question in the affirmative. As background, the parties in the Lombardi case were fortunate enough to save approximately $70,000 per month, accumulating approximately $5,500,000 in assets during their marriage, and lived a very modest middle-class lifestyle, excluding savings, of approximately $14,500 per month. With the goal of the husband’s early retirement at 45, the parties agreed to live this very modest lifestyle. The Appellate Division agreed with the wife that to permit only the husband to maintain the marital lifestyle enjoyed during the marriage was a reversible error.

The alimony statute amended on September 10, 2014, now directs family courts to consider, among other factors, the practical impact of the parties need for separate residences, and the attendant increase in living expenses with neither party having a greater entitlement to that standard of living than the other.

If you have questions about alimony or spousal support, you can read more about recent changes to the law here, contact us today.