What Are The Pros And Cons Of A Lump Sum Alimony Payment?
If you were ordered to pay alimony or you are the spouse receiving alimony, you might be considering a one-time lump sum payment instead of monthly payments.
There are several pros and cons of paying and receiving a lump sum alimony payment in Florida. Consult with our Orlando alimony attorney at Arwani Law Firm to help you choose between monthly payments and a one-time lump sum payment.
What is a Lump Sum Alimony Payment?
A lump sum alimony payment, commonly referred to as a buyout, is an alternative to monthly spousal support payments made over a predetermined period of time. A lump sum alimony payment refers to the payment of spousal support or its equivalent in a one-time payment.
Usually, the payor spouse makes a one-time lump sum payment with cash for the entire amount of alimony they will owe to the spouse over a predetermined period of time. Alternatively, the spouse who was ordered to pay spousal support may offer an alimony buyout by transferring their portion of the property for the equivalent amount of support payments.
Pros and Cons of Receiving a Lump Sum Alimony Payment
Pros of receiving lump sum alimony
- Certainty. Once the payor makes a lump sum alimony payment, the payment is yours to keep. If you opt for monthly alimony payments, the payor could reduce or terminate spousal support if they can prove a substantial change in circumstances such as the loss of a job.
- Remarriage. If you decide to get married again, you will not lose alimony because you have already received a one-time lump sum payment. The same cannot be said about monthly alimony payments upon remarriage.
- Employment. If you land a high-paying job after the divorce, your former spouse may request to reduce or terminate monthly alimony payments. If you receive a lump sum payment, you will not have to worry about losing spousal support because you have already received it all at once.
Cons of receiving lump sum alimony
- Squander. If you are a financially irresponsible individual, you may squander the large lump sum alimony payment in no time.
- Public benefits. Receiving a lump sum alimony payment may affect your eligibility for certain public benefits and government assistance programs.
Pros of making a lump sum alimony payment
- Severed ties. The biggest advantage of making a lump sum alimony payment to your former spouse is the ability to sever ties, as there will be no need to make monthly payments for years to come.
- Fulfilled obligation. You can lift the burden of a monthly obligation off your shoulders.
Cons of making a lump sum alimony payment
- Too much money. A lump sum alimony payment is usually a large amount of money.
- No ability to modify alimony. When making monthly payments, you have a right to modify the monthly amount once you experience a substantial change in circumstances. With a lump sum alimony payment, it’s paid all at once, and you will not be able to get your money back if your former spouse remarries or becomes self-sufficient.
You should consult with an experienced alimony attorney to determine which option is best for your particular situation. Schedule a consultation with our alimony attorney at Arwani Law Firm by calling 407-254-0060.