Unless we are independently wealthy, the majority of us work for a living and work for a long time in hopes of one day retiring. Retirement used to be more common than it now is as people continue to work later into life without retiring, if only because they cannot afford to retire. We often see people who would like to retire, but cannot because of ongoing support obligations.
If you have an alimony obligation can you ever retire? The answer is probably, but at what cost? Until September 2014, retirement was not a statutory consideration within the alimony statute. It was an issue addressed through case law, individual cases that were decided over time. In September 2014, however, the alimony statute, N.J.S.A. 2A:34-23, was modified to add subsection “J” to address “actual and prospective retirement”.
N.J.S.A. 2A:34-23(J) has three sections within it: (1) alimony termination upon retirement at “full retirement age” as defined by Social Security as when the payor is age-eligible to receive their full retirement benefits without reduction which is currently 67 years old (really 66 years and 4 months old); (2) early retirement, meaning at any date prior to having reached “full retirement age” and (3) retirement when there is a pre-existing final alimony order or settlement agreement that pre-dated the September 2014 amendments.
The statute presumes that retirement when the payor has been approved for full retirement benefits without reduction is a good faith retirement. The burden then shifts to the party receiving support to demonstrate why the alimony should not stop upon retirement. Does that mean that when you hit 67 you can retire and automatically terminate your alimony obligation? No. Does that mean you have no hope of retiring and terminating alimony before you reach 67 years old? Also no. It just means that retirement and alimony can be a tricky combination and you need to get legal advice before you retire and/or stop paying alimony. Nothing is worse than retiring, thinking your alimony has ended only to find out it is going to continue.
Before planning your retirement party, consult with counsel about how to handle the alimony obligation first.