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Diamonds and Pearls of WisdomThe DivorceWizards Blog, by Lynne DiamondIs Spousal Support Severance Pay...Happiness Tax...Entitlement...?Wednesday, August 17, 2011 I met with a client a few weeks ago who described spousal support as the “severance pay” she deserved. After all, she put up with all his “crap” over the years so she was entitled to enjoy the good life, sans him, for several years to come.What is severance pay? Severance pay, also known as “separation pay” is often offered to an employee when the company wants the employee to leave. There is no firing for cause and the employee has done nothing wrong – but the employer may want to downsize and eliminate the position or restructure for the same effect. Or maybe trade the employee in for a younger version. Often large companies pay severance pay. At Merrill Lynch, when I was employed there years ago, the severance package was one week of salary for every one year of employment to a maximum of twenty six weeks. Fair? Probably – a long term employee would have six months of pay and theoretically have time to become self sufficient. Another client described spousal support as happiness tax. He accepted the payment of spousal support as his ticket to leaving an unhappy marriage and settling in with a happy girlfriend. The price one pays for happiness – monthly payments to the former spouse. So is spousal support severance pay in California? Is it like a salary to give the lower earning partner time to regroup and become self sufficient? How about the length of spousal support? Sometimes payments may extend over years, even decades. Is that severance pay? Or happiness tax. The price you pay to move on in life. What are your thoughts? Does long term spousal support make sense in a long term marriage? Or is the severance pay too much for too long? Or too little too late? Should the state impose a “happiness tax” when people decide to get divorced? What do you think? |