Think savings is irrelevant in your alimony award? Think again.

It is well-established that the accumulation of reasonable savings should be included in alimony to protect the supported spouse against the loss of alimony. In short, savings has always been a relevant and appropriate factor to be considered in the establishment of a reasonable alimony award because the amount of support awarded is subject to review and modification upon a showing of a change of circumstances, which could result in the supported spouse being incapable of supporting himself or herself. However, the protection of income being derived from alimony is now not the only reason why a support spouse requires savings, especially where regular savings have been part of the established marital lifestyle.

In the most recent court ruling (Lombard v. Lombardi), the Appellate Division concluded that the dependent spouse is entitled to a savings component in his/her alimony award when the parties’ lifestyle included regular savings. Because it is the manner in which the parties use their income that is determinative when establishing a marital lifestyle, there is no demonstrable difference between one family’s customary use of its income to fund savings or another family’s use of its income to regularly purchase luxury cars or enjoy extravagant vacations. The use of family income for either purpose of the course of a long-term marriage requires the court to consider how the money is spent in determining the parties’ lifestyle, regardless of whether it was saved or spent on expensive purchases.

In fact, the Supreme Court of New Jersey has recognized the need to consider regular savings in determining a marital lifestyle by including a line item for monthly savings in Schedule C of the Case Information Statement.

In Lombardi, the parties were married for approximately twenty (20) years, thus being a “long-term” marriage. The Husband earned over $87,000 per month on average and the parties were able to accrue approximately $5.5 million in assets over the term of the marriage. At trial, the Wife’s expert testified that the parties had habitually saved an average of $67,000 per month during the final years of the marriage and, therefore, the Wife requested the amount of $30,000 each month for savings, on top of her alimony award of $16,291 per month and child support award for $5,000 per month. The trial court, however, awarded Wife the sum of $7,600 per month in alimony and granted Wife’s request of $5,000 per month in child support. Wife appealed the trial court’s decision regarding her alimony award, arguing that the trial court erred to consider the savings during the marriage. The Appellate Division agreed with Wife’s argument and vacated the trial court’s alimony award thereby remanding the case back to trial court. The Appellate Division further ordered that the trial court must consider the parties’ savings component while determining the Wife’s alimony award, given the evidence of regular savings adhered to by the parties during the marriage.

Accordingly, be sure that your attorney includes your savings component on Schedule C of your Case Information Statement. Your attorney must zealously argue that your alimony award shall be inclusive of a savings component; otherwise, you will be receiving a shortfall in your divorce. If you habitually saved during your long-term marriage, it is imperative that your alimony award is reflective of said savings.


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