Lump sum alimony payments are not possible for everyone. If your spouse is being ordered to pay, he or she has to have enough money on hand, after the divorce, to make the payment. However, in some high asset divorce cases, this type of money is present, and there are some benefits with lump sum payments.
First of all, if you’re getting the payments, you don’t have to worry about fighting with your ex down the road. He or she isn’t going to miss payments or send the checks late. You have all of the money up front and you know you’ll get what the court ordered.
The lump sum program also helps to cut you and your ex out of each other’s lives. Some people don’t like having to write or cash a check on a monthly basis. They still feel tied to their ex. They have to interact far too often. Getting the payments out of the way up front means you two can really go your separate ways.
There may also be added value for you if you take the lump sum. You could invest your money. If the investments do well, you wind up with more than you would have been paid otherwise. Plus, your total income doesn’t go down if your ex loses his or her job, or takes a pay cut. If you’re getting monthly payments, your ex may be able to ask for a reduction based on these types of income changes.
If you believe that lump sum alimony payments are possible after your divorce, make sure you know your legal rights and all of the options you have. You may prefer this one-time payment so you can move forward with your own life.
Source: Findlaw, “Avoid Alimony Monthly Payment Programs,” accessed April 12, 2017