In this second part of a 2 part post, I will provide an overview of how spousal maintenance works and why it is an important tool to make getting a divorce done in a fair and equitable manner. Spousal maintenance is Texan for what most of the world calls alimony.
In Texas, spousal maintenance are monthly payments that should not be confused with monthly child support payments or a payout of the property claims. One spouse pays the other spouse for some specific period of time to support the other spouse, either while the divorce is pending or after the divorce becomes final.
WHY AGREEING ON SPOUSAL SUPPORT IS A PROBLEM.
My experience has been that when people are in the middle of a divorce, making smart financial decisions is a difficult process.
A spouse who does not make as much money as the other, lacks a college degree, or who has been out of the workforce for some time raising the children and is facing a challenging job market often requests spousal maintenance. That spouse may feel deserving of compensation after divorce for sacrificing his or her own education and job to raise the family and support the other’s career.
For the spouse contemplating paying spousal maintenance, it can be equally challenging to think about supporting the ex-spouse over and above child support and the property settlement if the ex did not contribute earnings during the marriage.
In Texas, we have two types of spousal maintenance that can be used. The first type is called court ordered and the second type if called contractual. In this second part of this 2 part post, I will discuss the other kind of post-divorce spousal maintenance called contractual maintenance. It is voluntary and paid according to an agreement between the spouses as to how much it will be and how long it will last. If you want to read about court ordered spousal maintenance, click here.
With contractual maintenance, there are no legal eligibility requirements. If there are financial resources to do so, most commonly divorcing couples use contractual spousal maintenance to establish a required monthly stream of income for a self-employed, unemployed, or underemployed spouse at the time of divorce.
Stay at home parents or non working spouses frequently ask for assistance for a period of time from their spouses to help with tuition or educational expenses through contractual spousal maintenance if they want or need to return to school to establish or enhance a career, provide for themselves, and contribute more money toward children’s needs.
However, there is no guarantee for contractual maintenance either. If a spouse who has agreed to pay contractual maintenance fails to do so, the family court may not enforce by contempt (fine or jail time) an agreement to pay for any time beyond the period the court could have ordered under the laws for court ordered spousal maintenance.
Termination of Alimony.
No matter whether the maintenance is court ordered or contractual, it will end if either spouse dies. Under the law in Texas, it will normally end if the spouse receiving the maintenance remarries or lives with someone in a dating or romantic relationship on a continuing basis.
Tip for a Spouse Seeking Contractual Spousal SUPPORT.
Spouses seeking contractual spousal maintenance in Texas can avoid making a costly strategic error by getting complete information about the family finances before deciding how much spousal maintenance to request. A spouse should make sure he or she knows how much money there is to go around before jumping the gun out of fear and demanding an unreasonably high amount of contractual spousal maintenance.
If the demand is above the available resources or is outside the legal parameters for court ordered spousal maintenance, doing so almost always causes the other spouse not only to get mad, but often to seriously question the ability of the requesting spouse to make sound financial choices in the future. Too high a demand for contractual maintenance also frequently erodes the requesting spouse’s bargaining and negotiating power. When that happens, the spouse who was feeling scared about supporting him or herself after divorce will have an even harder time being comfortable negotiating division of assets.
The distrustful spouse may now feel the need to protect assets and keep them in his or her control rather than to have them in the hands of the other spouse who, rightly or wrongly, may appear unable to understand the financial picture and/or to manage money well. Impulsive, premature, uninformed actions and demands can jeopardize your credibility. Outright refusal to consider spousal maintenance can have the same result. For these reasons it is important to begin the actual negotiations of the property division, child support, and spousal maintenance only after everyone has complete information, understands the law, and has explored all options.
If you have any questions about this topic, please call our office at 972-772-6100 to schedule a no-cost initial consultation.