Some divorce cases, especially high-asset divorce cases, may have alimony payments as a component of the divorce. If you are facing the prospect of having to pay alimony, you might consider a lump sum payment instead of having to get roped into making monthly payments. If you are the spouse who is getting the alimony, you should consider the benefits that you will have if you get a lump sum payment.
One huge benefit of a lump sum payment is that you don’t have to make a payment each month if you are the paying spouse. If you are the recipient spouse, you don’t have to worry about whether you will get a payment each month. Instead, a single payment will be made and both of you can move on with your new life without the monthly reminder that comes with monthly alimony payments.
Another benefit to lump sum payments is that you know exactly what amount is going to be exchanged. With monthly payments, there are certain factors, such as the recipient spouse getting married again, that could mean the payments stop. For the paying spouse, having a recipient who never gets married could mean monthly payments for a long time to come. For recipient spouses, a lump sum payment would mean you aren’t at risk of losing the alimony if you fall in love again and decide to get married.
No matter what, you should make sure that you understand your rights and obligations when it comes to alimony. Missing alimony payments or not handling the negotiations about alimony correctly could lead to problems down the road.
Source: FindLaw, “Avoid Alimony Monthly Payment Programs,” accessed Nov. 04, 2016