Any advice on buying wife out of spousal support?

[Vinnie]

HI,

I'm not sure that "buying wife out" is how you word it.  She recently filed for divorce after a 20 year marriage. I'd like to offer her a lump sum in lieu of future spousal support, just to get the issue off the table. Anybody have any advice or any stories that might be enlightening?

The thought of being financially tied to her for the next 25 - 30 years is not pleasant and I'd like to severe those ties if I can!

She's got the boyfriend now that she left me for, and if that doesn't work out she is definitely not the type to be without a man.  I know her; she is excessively focused on money, and she would never walk about from spousal support, not even to get married to a new love of her life. If spousal support was coming her way or even a possibility for the future, she would do anything she could to remain unmarried, even co-habitating in secret if she could get away with it. 

She knows in the past I have a lot of ways to make money from various businesses (though the last few years I've failed spectacularly). I REALLY don't want her focused on me the rest of my life, checking into my income and gauging my lifestyle.

Right now I'm unemployed and interviewing for jobs in the $35-$45K range, which is less than what she is currently making. Presumably, she'd initially save money on having to pay me. But I have a degree and should eventually make more than her, in 2-3 years say.  Any suggestions on how to think through this?

[charred]

Interesting topic.

My dad bought out my mom on spousal support (was called alimony way back then)... . and he did it paying the full amount he was required to, ahead of time, and he did it because he could, as an ego thing... . he is a malignant NPD person, and a doctor and made a lot of money on a project I helped him with... . so I have seen it done... . in his case the divorce decree said that he would pay till both my sister and I were 18, same as child support. To get her to agree to ending the alimony then, he agreed to pay for all the college cost for my sister and I. (at the time I was in a city with hourly tuition of $12 per hour... . so my degree was about $3500... . my sister dropped out after a year, making it a bargain for him.)

However that is probably not what you are looking for... . but rather an example of it. I went through a divorce myself 3 yrs ago, after 22 yrs of marriage (prompted by my train wreck of an r/s with my pwBPD)... . so I have some pretty spot on advice in this area.

My wife (soon to be exwife at the time)... . was out to ruin me, she was pissed, hurt and not at all reasonable. In my state you can agree to whatever you want in your decree, and the state will accept it if its not unconscionable. However that didn't matter because she wanted to stick it to me, and the default formulas for the state (if you don't agree)... . were set to financially devastate me. I had lost my job, but make over 100K the two prior years, and she didn't work (quit her job when our daughter was born... . without discussion or warning, she made same money I did)... . so in my state, the formula is that the person that makes more must pay the person that makes less 44% of the pretax difference as spousal support. That is over 44,000 a yr ... . just in spousal, they also use a formula that gave child support of about $1100 a month. My main issue with my exwife was she had engaged in retail therapy, so she had ran up credit card bills and I had refinanced our house to pay them off and she had cut them up in front of me, and then behind my back, got new ones and maxed them out... . all of which came to light when I lost my job and started intercepting the mail and bills. So... . I had a high morgage with a second, and 80K in her credit card bills... . and no job and no possibility of being able to dig out, as even bankruptcy will not relieve you of spousal and child support... .   and I could not earn enough to service all that debt and support with the good job I had lost.

So, what do you do... . what I did was look for someone that had been in same situation and had good advice, and I found it;

www.greatdivorceadvice.com/NewCopy2.htm

The guys site looks like a late night infomercial, but what he is selling (NoBS divorce book)... . is a strategy guide for dealing with a high conflict divorce... . and its got some great advice in it. I paid the $50, and it saved me easily the cost of college for my kid.

Get the book... .   as to what I did (based on advice in it)... . I realized that my wife was hurt and angry and vengeful, and that she was counting on me to just go along with being unfairly railroaded in to working like a slave, while she was supported at a high level, given her role in our financial issues. So it became clear that I needed to change her mind about being adversarial and make it as reasonable as possible for both of us... .   I still had a good deal in a 401k and a pension, and a lot of assets, the issue was no job and lots of debt. So to get her to quit seeing things as "he will pay and I will take what I can"... . I got a really good attorney who specialized in high value estates, and who was an investigative journalist before he was an attorney. And I explained to her my plan... . I don't know where every cent went for all these years we were together, but I earned 3 times the average amount, and yet we were sinking in debt, and I didn't spend much at all. You refused to be held accountable to a budget, and now you want me to agree to a divorce decree that I can't live with, so here is what I am going to do. Every single transaction from when we were married, I want my attorney (and yours if you like) to examine, classify and explain to me... . so I will feel comfortable that it wasn't diverted or something... .   and my lawyer is 350 an hour and yours is 250, so we can spend $600 an hour (while neither of us is working)... . going over it, until we have all the answers or there is no more to spend, so lets do that.

After one request from my lawyer, and her talking to hers and finding out that it was perfectly legal to do what I was doing, and that the only money we had between us (the 401k and pension)... . would be gone, and her knowing that when pushed I do the same kind of NPD stuff my malignant NPD dad would... .   she had an epiphany and backed off of her original stance enough to say... . "other than shooting us both in the foot what can we do?"... . and I suggested she make a list of what she needed, and I would do the same and we agree to something we can both live with, and make the best of it. Which started out rough, but after I provided a list (based on the states outline of what goes in a decree)... . she took and changed it and we eventually agreed on a pretty reasonable settlement. Because we had filled out all the sections we were able to get it non-contested, we used her attorney (which made me nervous, but he didn't pull anything)... . and the total attorney bills ran about $2500, the divorce went the fast route and was final in 4 months, start to end... . faster than anyone I know of, other than me.

We both hurt for quite a while, but being apart helped me get over the resentment of her quitting her job, and her get over the hurt of me taking up with my pwBPD. My daughter is thriving in public schools (she was in private before)... . and is happy, my ex is happy, and I am seeing a light at the end of the tunnel.

The book helped me to see that it is strategy that you need, and it gives just enough understanding to help with that. You can both get attorneys and argue, but for the divorce to be a divorce, you both have to agree to it ultimately. Its possible for it to be forced by the courts... . but by then you will have been through a new level of hell, so reaching your own agreement is way to go. YMMV with a pwBPD... . but their self interest is your ally.

I agreed to 18 months of spousal support, and far less child support than the state guideline, I also agreed to help out more than I was required when I was able to and to see my kid more and do more than required. The thing that made it work... . I followed through on my words... . I paid 600-700 more a month for my ex when I was making good money and she still didn't have a job, I paid more on daughter as well... . and she appreciated it, she got a job, I paid a bit less extra but kept at it, now three years later, I don't owe spousal, I don't pay it, I pay a bit over the state amount for child support (lot more than we agreed to) and it helps her, she has a job, has been promoted and is recovered financially from our divorce. I have been doing contract work and now she is easing up on what I have to pay as I have been sitting home for quite a while. We have a wonderful daughter that we both need to be doing well to support and we both see it now, so it is possible.

One of the things she argued was she wanted the house... . and it had a high interest shorter mortgage and a second on it, so that the payments were about $1600 a month on it, with utilities it was $2000 a month, I knew it would bankrupt her, so I insisted she get something else... . the house was upside down as well, so no way to unload it. That was me looking out for her legitimate interests... . and she eventually realized it. She rents and has a nice house for about $750 a month, and is able to afford new car payments and entertaining and so forth, just from the difference in me keeping the house. The abandoned foreclosed house next to me finally sold and my property value just this month went up enough that I can refinance or sell at a small profit, so I have hope of it being better financially finally.

[Vinnie]

Charred,

Wow... .   you're really an ingenious guy. Good work. I'm glad to hear both of you found a good outcome and are recovering somewhat from the ordeal.  It could have been bad for you.

I don't know about yours, but as our daughter said the other day, my wife is really not that bright. Some people on this board are dealing with really smart and devious people, but my wife is devious but dumb. That gives me a little hope. I'm going to order the material you recommended, and hopefully get a strategy that will make her want to be reasonable.  I don't want to take advantage of her of course, but she has shown no reluctance to lie (e.g. her Petition) in order to position herself for a better order.

One complication just came up. We have two illiquid investments that comprise our whole retirement savings (no pension or assets other than those). Since they can't be sold or split, we were going to have to put them into a constructive trust -- whatever that is --and split the proceeds 50-50 when they cash out. I just heard yesterday that I might be able to cash out one of the investments this year - to the tune of $450,000 or so. At least I'll have some dough to buy her out - I was going to be forced to borrow it otherwise. I'm just noodling over how that will change the equation for her... .   whether she be more motivated to take a lump sum or not in lieu of future spousal support.

[charred]

I would not call it ingenious, more like desperately motivated to find a workable solution.  I was concerned about spousal support going on forever, as the state has guidelines for the amount... . but not the duration of it, so it is up to the judge if you haven't agreed to it in the decree. My reasons for paying more and being helpful are many; I don't want my exwife to fail, as she is the primary caregiver for my daughter, who is 12... . so I want to see her do well at least for the next 8-9 yrs to get my daughter on her way if possible. My exwife could take me back to court, explain she was duped in to settling for far less than she should have and I could end up paying again for a long time. Mostly, I was trying to get something that worked, we got along pretty well most of the 22 yrs we were together, she was my best friend in many ways and vice versa, and I would rather have her on my side than against me.

My exwife is not book smart, she is very relationship and people smart, she is not the pwBPD that got me on to this site. My pwBPD is very smart (Phd level education, fast mind)... . and devious and scary when mad. She is like a smart Jodi Arias... . if the same thing happened to me, pretty sure my pwBPD would think it out and get away with it... .   which is part of why I am done with her.

Hopefully your wife will be open to something reasonable, I was concerned with surviving financially and having an end in sight for the payments... . 18 months surprised me that she took it, I had planned on going back and forth and settling on more like 24-30, so it was nice. Retirement savings are not the best way to deal with it in my opinion, they are usually pre-tax, and can be moved in part to the ex-spouse as part of a QRDO... . then they keep whatever portion and its still pretax and no big fees/penalties, so maybe that would work, but you are typically looking at a 10% penalty to take one out early plus the tax and that leaves like 60% of whatever you started with... . for the money you mentioned... . could be 180K coming out of it... . yikes, hate to give up that much in taxes/fees. My ex got her 1/2 of everything, then refused to listen to my advice (talk to a bankruptcy lawyer)... . and took her part of the credit card debt... . then represented herself in court when the credit card people wanted all her 401k/pension money... . the judge made his decision in less than 1 minute... . he asked did you buy the stuff, she said yes, he decided for them, no other input, she lost all of it, then had to declare bankrupcty when another credit card company was going to attach her check. (Her being pissy cost her about a year of my income, or about 3 yrs of hers... . as personal bankruptcy would have shielded the 401k/pension and released her on the cards.)

Anyway, if you have a kid with her and are going to be having ongoing interactions, try to find something that works for both of you. She might go for the shiny stack of money, get it and be broke in 6 months... . might work for you, probably not the ideal solution, but see what you can work out, I had a lot of hard feelings for a while, but finally trying to come up with a solution that helped us both became the clear way to go.

Good luck

[charred]

Oh... . one other big thing, whatever you do, find out what the taxes will be and plan for it! I wasn't working as I said, and we had to take out some money from 401k, so they gave option of witholding  the taxes/penalty or not, and I figured I would be working, so I didn't withold it. (Took 60k out)... . so we had the divorce and she got 30k for current bills... . so did I, then she had everything attached and lost it all, and declared bankruptcy... . at which time the taxes became due on 60k... .   and she didn't have squat, so I ended up paying my normal taxes, plus a lot for the taxes and penalty... . and it left me with $300 in the bank... . and I was working, it was closest I have been to being insolvent in my career.

Spousal support is tax deductible to you, taxable to her, child support is not deductible at all. Being able to claim your kid as an exemption is worth money and can be part of your decree (if you have her part of time... . might need to check in your case)... . I gave it to ex as she has daughter most the time really.

All that stuff, as well as any tax implications from sale of property, should be looked at and planned with if you have a good deal of funds. My accountant is good at after the fact making the best of it, but sucked at helping me plan, yours might be usefull, if not check in to it yourself, it can be a big thing. Maybe you can taper off the payments over time and come out better? Anyway, good luck, anyone getting a divorce needs all the luck they can get.

[ForeverDad]

In my case, my ex got a portion of my 401(k) retirement account but I was careful not to pay her directly or let her withdraw it from my account.  The QDRO, which is a standard way to be ordered to handle the asset transfer, instructed that a new account be made for my ex within the plan and her portion be placed there.  Then it was totally up to her what she wanted to do with it.  And whatever she later withdrew that had tax or early withdrawal penalty ramifications would be ex's responsibility, not mine.

Also, as respects child support, be careful that a spouse may not have the legal ability to give up rights to claim child support.  In my case, our lawyers reached an agreement where I paid spousal support rather than child support so that I as the major income earner didn't have to pay the taxes.  Alimony is is recipient's responsibility and my ex's low income meant she didn't pay taxes on it either.  However, my lawyer inserted the condition that we would go back to court to reduce spousal support IF she filed for child support.  My lawyer said she could always file for CS and get it notwithstanding her agreement otherwise.