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  • Spousal Support Review?

    Hi,
    Hopefully, a few of you can provide your thoughts or experiences with some questions related to question I have regarding spousal support. This is the stuff that keeps me up at night. I want to plan my life and retirement but a ruling with no fixed spousal support term makes that hard to do. The family law system in this area is poorly designed and only works for lawyers and the ones receiving the support.
    My X is receiving spousal support and has not at all started looking for work after 5 years. She has no incentive to work as she making a good income off me with no end in sight. There is no process setup to aid, monitor and enforce that she is looking for work to become self-sufficient.

    Here are the facts before I start asking questions:
    - Married 16 years (includes 1 year living together)
    - Separated in 2007 and divorced in 2010.
    - In 2007 my ex was 49.
    - One child who is 17 now and in grade 12 (2012) and will be going to university next year.
    - Spouse has a university education and did not work during the marriage (one of the marriage issues)
    - My income in 2009 was ~$150K and was used to set SS amounts
    - Spousal support was set at $3.2k with imputing income of $18k / year to my spouse ($39k)
    - Child support is now $1.4k
    - Current income is ~160k
    - Support together is $4.6k / month which about half of my take home income ($51k)
    - The Separation Agreement has a cause that states “Spousal support shall be reviewable not before January 2012 and again not before June of 2015.The court will, at the time, review both party’s financial situation and X’s attempts and success at becoming financially independent”
    - The Separation Agreement has a cause that states my retirement is a material change in circumstances.
    - Agreement also has a clause that if my son goes away to school then child support will be nil while he is away but I am to share post secondary expenses proportional to incomes.

    Questions:
    1 - Should I have the first spousal support review now? (Late 2012).

    I think my spouse needs to be pushed to start becoming self sufficient but reviewing the process we are looking at 10s of thousands of dollars in lawyer fees on both sides (screwed up process that only works for lawyers and is no something someone represent yourself). Should I instead wait another year or more with a more material change being my son has gone to university or what should trigger the review?

    2 - Can the X receive spousal support if I’m retired?

    My pension was included in the equalization and she has released interest on it. How can she get spousal support when I retired as that is double dipping since it was already accounted for in the equalization?

    3 - Is there another way to ensure my X is looking for work and having it enforced so she is motivated to do so besides the expense and drama of a review in front of a judge?

  • #2
    I am in receipt of substantial spousal support. My ex has taken me to court 2 x a year for the past three years to try to have the SS overturned. He failed every time. We were married 30 yrs so my situation is vastly different and I do not have "children of the marriage" so CS is not an issue.

    No you cannot decide to retire to avoid paying SS or CS. My ex recently tried that one and he was unsuccessful.

    You have the opportunity when your SS agreement is up for review to exert your position that your wife should be self-sufficient. As your wife did not work throughout your marriage she would be considered be able to do minimum-wage work. Your wife is now 54 yrs old? I will be 56 next week so we are similar in age. I did not receive any property settlement in my divorce (no house, no RRSP, nothing). My ex put all of our money (business) into a girlfriend's account and left me penniless so the house eventually went into foreclosure even though it was originally soley my house and any mortgage taken on it was used to inject into the business. The reason I am telling you this is so you can compare situations. I put over 350k into our business. It was documented. I was a full partner in the business. I received no cash settlement, property or RRSP. You would have to factor that into the equation. If your wife at roughly age 54 has no property, RRSP or anything then it can be difficult for you to be able to say she is self-sufficient.

    Collecting SS is not a cup of tea. I am uneligible to pay into CPP and my SS is 100% deductable. You, on the other hand, claim the SS as a 100% tax deduction. An astute lawyer will bring this to your attention. So after you calculate what her NET income is in SS you will have a more realilstic picture of her situation,

    Best thing is for her to feel good about herself and WANT to get a job. Unless a person is collecting over 10k in SS it's really not anything to brag about in my books simply due to the tax implication Also, it's pretty lame to always be asked "so what do you do for a living" and you have to reply 'go to court to defend my lousy SS" - wow that's really fun. NOT.

    You will likey never get employment readiness/hunting enforced for a 55 yr old woman, particularly if you are a high income earner. Best to try to work with her to help her get on her feet. As you are a high income earner I'm sure there are tons of lawyers who will tell you what you want to hear (like my ex's lawyer) but you are wasting your money.
    Last edited by arabian; 10-15-2012, 11:46 PM. Reason: used wrong word

    Comment


    • #3
      Also meant to add that while your agreement specifies employment readiness and she is imputed with income (as am I imputed with income on a graduated scale which is probably intended to encourage me to become self-sufficient) the age and circumstances of each individual is weighed at the time of assessment. Older people have health problems. You can beat your head against the wall but if your ex gets medical documentation (that all of us over 50 yr old women can easily get) that states she has medical issues you will be unsuccessful in any attempts to force her to work.

      I have recently had a conversation with my ex (out of court which is really surprising) and I told him I would like nothing better than to get back to work. The money he has spent in trying to have SS overturned would have paid for a new car for me as well as a downpayment on a decent place. Judges see this and aren't stupid. Keep your cool and look at the whole thing logically and then make your move.

      You were only married 15 yrs so your situation is likely very different than mine but just be aware of things. A good lawyer who believes in collaborative law would do you no harm at this point.

      Comment


      • #4
        Material change of circumstance: your savings are wiped out, you lose your job, you are dying. Anything short of that is another money-grabbing antic of disreputable lawyers. Don't believe them. MY EX DID AND LOST MISERABLY.

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        • #5
          Arabian: I think you meant to say (see 'cup of tea' above) that the SS is taxable income (to you).

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          • #6
            Yes thank you hadenough. SS is taxable to me. I have no business deductions so CRA and I are intimate at this point of my life LOL!

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            • #7
              1 - Should I have the first spousal support review now? (Late 2012).
              Do it as soon as it's able to be done. Follow the order to a "t". If you ex was working over the last few years, argue that she would reasonably expected to increase her wage by ~ cost of living. (3-6%/year) over that time and that her imputed income should be increased accordingly.

              You have a review date built into your SA...leverage it. Your son graduating post secondary would be a material change relating to CS, not SS. They are separate issues. Deal with the SS as per the order, deal with the CS as per your agreement and the family law guidelines.

              Can the X receive spousal support if I’m retired?
              Yes. Though retiring is a material change in circumstance and would be grounds for a review of the items again. I suspect that second date (2015) is based on the earliest you can be reasonably expected to retire.

              My pension was included in the equalization and she has released interest on it. How can she get spousal support when I retired as that is double dipping since it was already accounted for in the equalization?
              It's considered income. Instead of working, you are retired and drawing from the pension. The (lower) amount you receive as a result would be the net new amounts used to calculate the SS obligations go forward.

              Is there another way to ensure my X is looking for work and having it enforced so she is motivated to do so besides the expense and drama of a review in front of a judge?
              Put it this way, you were with her for 17 years. During that time, how much success did you have motivating her to look for gainful employment? She hits that magical "rule of 65". Her age + duration of the marriage is >= 65 years. She's proven entitlement to spousal support, so you are very very likely on the hook for it for life.

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              • #8
                move to financial section.

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                • #9
                  Thanks Arabian and NBDad for your feedback.
                  I dropped out a few details from the first post for it to fit, like she has the house which was paid off, a car and an inheritance. She could have also created an apartment in the house to gets some income without even working. I am broke and all my RRSPs and stocks went to lawyers. I am reluctant to go further in debt without a feeling that I will be better off in the end to do so. Also, I know if I do nothing then nothing will change. I not looking to end SS just have it reduced over time and at some point know when it will end. I’m not trying to retire to get out of SS. I have worked many years and deserve to retire while I still have my health to enjoy it. I shouldn’t have to work so the X can stay retired.
                  Questions:
                  4 – What happens at the reviews and what would both parties need to provide and present in my case?
                  5 – Inheritance is excluded as part of division of property during SA. Is it consider and included as part of the SS review?
                  6 – Is increasing imputed income to the X the best method to get the SS reduced over time and what about asking for a termination date?

                  Comment


                  • #10
                    As far as I know (I haven't been through the review yet) I have been led to believe that everything is reviewed with emphasis on need and ability to pay. Full financial disclosure would be presented again as it was done when establishing SS. You basically present financial "photos" of your individual financial situations.

                    As another poster correctly pointed out, the rule of 65 came into play. If your wife doesn't seek employment and become self-sufficient she will be supported by you. I can tell you that the graduated imputed income is an excellent incentive to find work. It doesn't make sense to be imputed income and not go out and earn at least the amount you are imputed with.

                    You might request a termination date for SS and you very well may be successful. All comes down to the judge's determination. In another post Old Lawyer made a very good point about judges personal backgrounds and their inability to relate to the everyday joe's situation. If you are a high income earner (over 150k) then 3200.00/month is actuallyl quite reasonable SS although I can understand how it must bite when you have to pay CS as well. Your kids hopefully won't be financial burdens forever but unless your wife gets a job she definitely will. Yes, focus on the graduated imputed income. 18,000.00 one year 24,000.00 the next and so on.
                    Last edited by arabian; 10-16-2012, 10:14 PM.

                    Comment

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