What Happens if There Isn't Enough Money to Pay Alimony?

If there's one constant in divorce, it's this: there's never enough money. Unless you're a doctor, successful business person, or international pilot, there simply won't be enough money to go around to allow everyone to live like they used to live during the marriage.

Where this lack of funds really plays out is in alimony. There's always enough money to pay child support (well, "enough" is a relative term; there's "enough" because child support is required, so people have to come up with the money), but not so with alimony.

Quick Alimony Primer

Alimony in most Utah divorces is calculated pretty similar to this:

First, you look at the spouse who makes the least amount of money and determine what his or her income is (income is really any money coming in from any source) and what the reasonable monthly expenditures are (e.g., debts, mortgage, daycare, food, etc.). If that spouse runs in the red (i.e., more goes out than comes in), then there is a need for alimony.

Second, you do the same calculation for the spouse who makes more money and you see if that spouse has more money coming in than going out. If so, then that spouse has the ability to pay alimony. If one spouse has a need, and the other spouse has the ability to pay, then an alimony award is likely.

Here is an example illustrating how alimony might work. Alice and Tom have been married for seven years. They have one child, Matthew. Alice works and makes $15 per hour. Tom works and makes $25 per hour. When you look at Alice's net monthly income, it's about $2100 per month. Her reasonable monthly expenses are calculated to be $3100 per month. (I'm making up numbers here for the sake of the example.) Tom nets about $3600 per month from his job. His reasonable monthly expenses will be about where Alice's are, $3100 per month. This means Alice has a need of $1000 per month, and Tom has the ability to pay of $500 per month. So, Alice would be awarded $500 in alimony for up to seven years.

What if There Isn't Enough Money To Pay Alimony?

Usually, when there isn't enough money left over after paying child support and all necessary expenses, then alimony isn't paid.

Notice that Alice above only received $500 per month in alimony, even though she needs $1000 per month. This is because judges recognize most of the time there simply isn't enough.

However, there are times this rule does not apply and the court will "equalize the hurt." These situations come up when neither party makes enough to cover individual monthly expenses.

In these situations, the court will put everyone's wages in a pot and cut the pot in half. The idea is no one gets to pay their bills in full and everyone suffers.

Here's another example, and let's use Tom and Alice again. Alice makes $2100 net per month, and has necessary monthly expenses in the amount of $3100. Tom nets $3600 per month and has necessary expenses in the amount of $5000 per month. In this scenario, the court could put Tom and Alice's net wages in a pot and cut them in half. That pot would be $5700, and the total to Tom and Alice would be $2850. So, Alice would be short $250 per month, and Tom would be short $2150 per month.

Personally, I do not like "equalizing the hurt." Thankfully, judges don't happen often, but it happens enough to worry about. 

Takeaway

The major takeaway is this: alimony is not an exact science. There is variability in alimony awards, and that means leaving alimony in the hands of a judge at trial is inherently risky. This is why we prepare well and negotiate intelligently during mediation. If you can come to an agreement in mediation, it's almost always better than putting your life in someone else's hand and taking a shot at trial.

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