Receiving alimony or spousal support after a divorce can help you to make ends meet while you move forward with life on your own. It’s not always easy starting out on your own again, especially if you sidelined your career while married. For this reason, alimony can sometimes last for a few years.
Many divorcing couples decide to make it a monthly payment. Yet you can also opt for a lump sum. What are the advantages if you do this?
You know your spouse will pay everything
You may be concerned that your spouse is going to stop cooperating a year or two from now. Getting all of the money upfront means that you know you get 100% of those alimony payments at the time of the divorce. You don’t have to worry about it getting difficult to collect in the future.
Your ex’s employment no longer matters
Similarly, people are sometimes worried that their ex is going to see a reduction in income or lose their job entirely in the future. If this happens, they worry that they won’t get those necessary alimony payments. But getting a lump sum at the beginning means that, even if your ex does lose their job in the future, you’ve already been paid.
Money is worth more
From some perspectives, getting the money upfront also means that it’s worth more. Inflation means that money you would have received in the future will be worth less than money you receive today. Additionally, you can invest a lump-sum payment so that you earn interest on it.
These are just a few of the reasons that people consider lump-sum payments. As you go through a divorce, just be sure you know about all the legal options you have.