Divorce at Altitude: A Podcast on Colorado Family Law

Paying Alimony or Spousal Maintenance and Retirement with Ryan and Amy | Episode 127

October 26, 2022 Ryan Kalamaya & Amy Goscha
Divorce at Altitude: A Podcast on Colorado Family Law
Paying Alimony or Spousal Maintenance and Retirement with Ryan and Amy | Episode 127
Show Notes Transcript

Many people plan for retirement with their spouse in mind — and then they get divorced! During today’s episode, you will hear what it takes to qualify for spousal maintenance, and why the court might be reluctant to grant it. We touch on Colorado’s advisory guideline for maintenance and support, with a specific focus on the road to retirement and beyond. 

Hear how the court considers your life plan when landing on a maintenance plan, and what the two kinds of maintenance entail. Will Eric Wolff have to pay spousal maintenance or alimony after divorce? Join us as we discuss some key points regarding spousal maintenance and retirement and equip yourself to plan for your future today. 

Key Points From This Episode:

  • Today’s topic: spousal maintenance and retirement.
  • The court’s impetus is to find out if they can split assets without having to institute maintenance.
  • What it takes to qualify for spousal maintenance in 2022 in comparison to the past.
  • Why the court might not like spousal support.
  • Colorado’s advisory guideline according to which support is decided.
  • Navigating spousal support in and leading up to retirement.
  • How the court determines support based on what you had planned for your life.
  • The two kinds of maintenance: modifiable and contractual.
  • The rebuttable presumption around retirement and finances.
  • Understanding that lifestyle changes usually occur after a divorce.
  • Considering all sources of income and benefits.
  • Addressing remarriage through the lens of retirement, divorce, and support.

What is Divorce at Altitude? 

Ryan Kalamaya and Amy Goscha provide tips and recommendations on issues related to divorce, separation, and co-parenting in Colorado. Ryan and Amy are the founding partners of an innovative and ambitious law firm, Kalamaya | Goscha, that pushes the boundaries to discover new frontiers in family law, personal injuries, and criminal defense in Colorado.

To subscribe to Divorce at Altitude, click here and select your favorite podcast player. To subscribe to Kalamaya | Goscha's YouTube channel where many of the episodes will be posted as videos, click her

What is Divorce at Altitude?

Ryan Kalamaya and Amy Goscha provide tips and recommendations on issues related to divorce, separation, and co-parenting in Colorado. Ryan and Amy are the founding partners of an innovative and ambitious law firm, Kalamaya | Goscha, that pushes the boundaries to discover new frontiers in family law, personal injuries, and criminal defense in Colorado.

To subscribe to Divorce at Altitude, click here and select your favorite podcast player. To subscribe to Kalamaya | Goscha's YouTube channel where many of the episodes will be posted as videos, click here. If you have additional questions or would like to speak to one of our attorneys, give us a call at 970-429-5784 or email us at info@kalamaya.law.



Ryan Kalamaya (3s):
Hey everyone. I'm Ryan Kalamaya.

Amy Goscha (6s):
And I'm Amy Goscha.

Ryan Kalamaya (8s):
Welcome to the Divorce at Altitude A Podcast on Colorado Family Law.

Amy Goscha (13s):
Divorce is not easy. It really sucks. Trust me I. Know. Besides being an experienced divorce attorney, I'm also a Divorce client.

Ryan Kalamaya (20s):
Whether, you are someone considering divorce or a fellow family law attorney. Listen in for weekly tips and insight into topics related to Divorce co parenting and Separation in Colorado. And we're back with another episode of Divorce Altitude. I am Ryan Kalamaya. This week I am joined by Amy. Amy, what are we talking about today?

Amy Goscha (46s):
So today we're talking about spousal maintenance and retirement.

Ryan Kalamaya (50s):
Why are we talking about maintenance and Retirement? Are you looking to retire anytime soon?

Amy Goscha (55s):
No, but we have a lot of clients that you know, maybe have or will and you know, they have a certain plan. They're married a long time And, they have their plan for Retirement And, they decide to get divorced and then we have to figure out, well, you know, do they owe their expo or soon to be ex spouse, you know, money each month if they're not retired and continuing to work So, that's why we're talking about these issues because they're relevant in a lot of our cases in clients that have those issues,

Ryan Kalamaya (1m 23s):
We are seeing a lot of gray divorces. We had a previous episode on gray divorces And, we referenced spousal maintenance and retirement. But it really will get into what happens if Eric Wolf gets in in a Divorce in his sixties and all of those things. But can you give a general overview, Amy, as of this recording, we haven't courted season four of the Divorce at Altitude how to podcast about support, but Spousal support. What are the general factors that are considered in by court for determining Spousal maintenance or Alimony?

Amy Goscha (2m 2s):
And so I think where we'll start is what a judge is looking at whether or not to Award Spousal maintenance is the court's first looking at the property and the debts. The court is looking at can I divide property without the need of having one spouse to pay the other spouse, you know, for support. But if it's a circumstance where that you know, can't happen, then we have 14 10, 1 14, which is the maintenance statute. So I'll let you Ryan kind of give me the lay of the land of, you know, just in Colorado, what does it take to qualify for Spousal maintenance?

Ryan Kalamaya (2m 35s):
So it used to be before 2014 and Robin Badie And I talked about some of the revisions on a separate episode with Spousal maintenance. It used to be that you would have this threshold of whether or not someone had reasonable property to sustain themselves. And now what we've The court first has to do And I think a, you know, an unsaid issue for The court is that they don't like Spousal support. Maybe one of the reasons, what I think is one of the reasons is that they have to go through a ton of factors and explicitly identify them. That is if they don't or Award maintenance. But the first factors that they have to look at are the gross income of the parties.

Ryan Kalamaya (3m 16s):
And, I think a lot of people, they really just focus on the income, income, income income. And we've had other Episodes net spendable income with Boris Sobel a for example, to talk about that. It's not just looking at the the income, but it is a factor. And as you referenced, the second factor is the marital property allocated to each party. In the way that that comes up is the financial resources of each party, specifically the actual or potential income from separate or merit of properties. So if Eric Wolf walks away from a Divorce with $10 million, then he can, you know, use that $10 million presumably. And it depends on what that $10 million is.

Ryan Kalamaya (3m 56s):
Is it in a business that's illiquid, is it in some sort of trust that he won't ever, or at least right now can't get access to that really is going to matter. And then we're gonna look at the reasonable needs established during the marriage. So you know, Warren Buffet is one of the most well known. He's a billionaire, multi, multi, multi-billionaire. But he has this lifestyle that's a fairly spartan lifestyle that a lot of people talk about. And the financial needs established in his marriage is going to be different than some of my clients in Aspen that, you know, love to jet set on private jets. Not that Warren Buffet doesn't take a private jet, but you know, they really eat out a lot.

Ryan Kalamaya (4m 37s):
They spend a lot of money on clothes in restaurants, lifestyle during the marriage is is gonna matter. And then finally we get to ability to pay and that's one of the first things that at least Eric is going to reference if he's gonna be the payer. But Amy, why don't you talk a little bit about the guidelines because that is also something that The court has to consider in figuring out the amount and duration and whether it's fair and equitable.

Amy Goscha (5m 5s):
Yeah, so in Colorado we have an advisory guideline and that advisory guideline is only to combine gross income of 240,000. And the factors Ryan that you were talking about are in Colorado. Essentially we have to meet a threshold essentially for a court. A court has to make certain findings to say okay, like you've met the threshold test, you know, now let's go and figure out how much you need. And so, you know, those are kind of some of the parameters to look at. Like in Colorado, you know, the advisory guideline says you need to be married at least three years really to even, you know, the duration of the marriage needs to be at least three years even to look at maintenance.

Amy Goscha (5m 46s):
There is language within the statute that says, well there are certain circumstances, even if it's a short term marriage that you might qualify for maintenance. And, I think that one thing when I'm talking to clients, if I'm representing, let's just call it Melanie, if she's not the earner in the case, you know, Melanie's talking to me about, you know, well we did these certain things, this was my lifestyle during the marriage and the first thing I talk about is, well yes, but we also have to look at, you know, you're dividing things like you're not together and you can't exactly spend what you were spending before. So you know, the court's gonna look at those things. If I'm representing Eric, you know, he's going to say, well you know, she spends way too much money, you know, I don't wanna pay her Spousal maintenance.

Amy Goscha (6m 31s):
And the thing that I'm talking to Eric about is that I'm really looking at your ability to pay. But also a lot of times the spouse who has the money ends up having to pay more to begin with because the court's also looking at your age and like what is your ability to earn? So the earner a lot of times has an ability to kind of make that up, you know, down the road. So those are some things that I at least talk about with clients, you know, in those positions. Do you have anything to add to that we're

Ryan Kalamaya (6m 59s):
In? Well I think to tie it back to the purpose of the show is how does Retirement matter? And when we, I think at the very beginning, so if Eric Wolf is getting a Divorce in his late fifties or in his sixties, there's gonna be an issue of well if I have to pay maintenance. And oftentimes when these people are in their Retirement age or Retirement is a discussion, oftentimes these are long term marriages and you know, we have commented that judges generally are against Spousal support and there's just been this general trend and And I do I agree, I think that judges, they try to make up the property division So that they don't have to Award maintenance And.

Ryan Kalamaya (7m 44s):
We will get into the modification, especially with Retirement and maybe people can think a little bit about why, but when we're talking about long-term merits, it used to be that you would get maintenance or Melanie if she was the recipient, she was gonna get maintenance or Alimony for the rest of her life, right? And that is generally not, we don't see those permanent lifetime awards anymore. Which I think is fascinating because if you think about, it used to be Amy, you know, you And, I are even too young to kind of work for a company like GM or GE or Ford where you would put in your time, you would work there your whole career and then they would get a lifetime pension and you would get that guaranteed.

Ryan Kalamaya (8m 35s):
And it's really problematic because we've gone to 401ks and people now are responsible for saving on their own. And whether or not by the time you And I retire, Amy social security's gonna even be there. And just as an aside, social security benefits, they cannot be divided. There are issues of Melanie, can she rely on the savings and social security that was acquired or contributed by Eric and those sorts of issues. But if Eric is looking to retire, he might have enough money that he says, Listen, I killed it on Wall Street, I moved to Aspen. I'm seeing a lot of these people that have recently relocated And, they have a lot of money and they're not working And, they don't have to work.

Ryan Kalamaya (9m 21s):
And if they have a hundred million then we're probably not talking about Spousal support because Melanie, if she gets, you know, even $50 million, she's probably gonna be okay and we're gonna have some other Episodes on those extremely wealthy individuals. But if Eric decides I wanna retire at the age of 60, well you know, there might be some repercussions. And how the law has developed around that is really interesting. And that is that we have now this provision in the law of 14 10, 1 22 that says that if someone has reached full Retirement age, then they can seek a modification.

Ryan Kalamaya (10m 4s):
And there's a process by which, and there's some law that has developed around that. What we're lacking is any sort of guidance on what happens if Eric is 65 and he's contemplating Retirement, is he supposed to keep on compelling Melanie until he actually Retires? I mean Amy, we're self-employed, we run our own business and the statistics are pretty compelling. Self-employed people, they generally work longer than full Retirement age and, and full Retirement ages defined differently by the Social Security administration in terms of when you're eligible. So it could be 66 in eight months and the government's trying to push back Retirement because of the entitlements and people are just living longer.

Ryan Kalamaya (10m 52s):
So those sorts of things are at issue in a Divorce when Retirement and maintenance are involved.

Amy Goscha (10m 59s):
Yeah, And I, that just brings to mind too cases I represented a lawyer who you know, is a partner at a firm and is early sixties, but he, you know, like a lot of us, like he likes to work right? And so, you know, there was an issue as to whether or not like, you know, like he didn't want to be required to work but wife would possibly get, you know, a certain amount of that, you know, while he was still working because it was, you know, a long term marriage. You know, I have another client who you know, is in in a medical practice and just really has worked hard and now wants to retire and that was in the plan but then he is looking to get divorced. So you know, these issues come up where I think The court also, my experience has been when I deal with this with clients that The court also will be looking at like what was your life plan?

Amy Goscha (11m 48s):
Like if you're looking at these long term marriages, you know The court is really going to look at that as well. You know, like what we're looking at, what The court doesn't wanna see is someone who's earning money and then just says, well I'm just gonna quit working. You know, like that's not what The court wants to see. So those are just some thoughts that I have on, yeah,

Ryan Kalamaya (12m 7s):
And I think people need to understand. So what Erica's probably looking at if he's going through a Divorce is there's gonna be a certain amount of Alimony or maintenance that's going to be set. But that can be changed. It can be, and obviously Melanie and him, there's different, I think people should know there's two different kinds of maintenance. There's modifiable, which is what would happen if you went to the judge and we'll talk about that in detail next. But there's contractual, so there is going to be a set amount where Eric is gonna pay Melanie, you know, $10,000 a month for four years and then that is set in stone and he could continue working in those circumstances.

Ryan Kalamaya (12m 47s):
If I'm representing Melanie, you know, and she tells me he loves to work, Eric loves to work, he's gonna work until he dies or he is gonna keep on working, then it would be a disservice to my client if I would agree it's a contractual, but she might like that. Both parties might like that. But what would happen is Eric probably is gonna agree to modifiable maintenance and it could be $10,000. And then once he reaches full Retirement age and he actually does retire and there can be different forms of Retirement, which I'll address next, but he would then file a motion to modify and say, listen, I judge I have changed my life. And an example is in Remarriages of swing where the husband, in that case he was a long range truck driver, so he would drive across the country and he made good money and then once he reached a certain point he was like, I'm tired of sleeping in the back of my cab.

Ryan Kalamaya (13m 44s):
And I wanna drive for UPS or FedEx. It was a local delivery. So he was still doing the same thing. He was driving a truck but it wasn't as intensive, he wasn't making as much money and he reached out to The court and said my maintenance needs to be lower and So, that was an older case that just gives an example of what happens. And another example is in your marriage of Thorstad which came out and basically what happened is there was a change in the law under fourteen ten one twenty two, which is the statute on modification. And it says now, and it was a recent edition that if there's a full Retirement, someone has reached full Retirement aids, then they're presumed to be retired in good faith.

Ryan Kalamaya (14m 29s):
And so Thorte, what happened is the husband, he reached full Retirement age and then he filed a motion to terminate maintenance. And The court in that circumstance said, Yep, you're done, you're completely retired and just terminated the maintenance. And that went up on appeal and The court of Appeal said, no, no, no, it's not such a bright line test and really established what would happen is that there's a rebuttal presumption. So what that means is that someone Retires and that could take different forms And, they could be going to part-time, but if they've reached full Retirement age, then it's presumed that they have kind of dialed it back or retired and they've done so in good faith. And you know, Amy, you And I are familiar but you know, Divorce flew or similar concepts where people, they just quit their jobs or despite the other party and underemployment is a real thing.

Ryan Kalamaya (15m 21s):
And in marriage at Breer is a, you know they, I tend to describe them as the shitty lawyer cases where a lawyer, cuz there's multiple of em and in marriage at Bregar was one of 'em where the husband was a lawyer, he quit his job to go be an apple picker and you know, The court said, you know, you can't do that or if you can but we're going to impute income to you. And so in Thorstad tying it back to that case is that The court said listen rebuttable presumption that you are retiring in good faith, you're not trying to screw over the recipient spouse and then the burden shifts to the wife or the recipient to say no, you're just doing this despite me.

Ryan Kalamaya (16m 1s):
And but that's just one factor among a variety of factors that I talked about. And one of 'em is the pays dependence on maintenance. So if Melanie is dependent on Eric then it doesn't, doesn't mean that she just completely is cut off. It might mean that there's a reduction but it's one that Retirement is one factor and you know, it brings up, you know, these issues that we've addressed and there's really no easy answer. Really depends I think on how much someone was earning with their ages. I think there's a material difference between someone who's trying to retire at 63 versus hey, you know, at 65 and we've gone, like you said, in terms of that life plan, if they had gone to a financial advisor and said our mutual goal is to retire early, that's going to be a different example or circumstance than, you know, one person is trying to retire early and the other person's working.

Ryan Kalamaya (17m 3s):
I mean I just had a case where the wife was 70 years old and you know, our client was 65 and he wanted to retire early or earlier than full Retirement age, which for him was 66 years and eight months. And those are tricky situations and the reality And, we address this in the great Divorce episode is that you can create a plan when you're married. But the reality is that when you go through a Divorce, those circumstances in those life plans, they can change and people might not be able to retire. But the lifestyle that people envision traveling around and doing things in Retirement age that might be different than the Retirement or the plan that they had had and really the lifestyle that they lived when they were married and working.

Amy Goscha (17m 53s):
Yeah, And I think also timing on Retirement. I had a case where both parties were in their sixties, the wife had retired prior to divorce, the husband was planning to retire So, that that was his plan that was still working and The court found that it was a good faith Retirement for wife but not for husband and ordered husband to pay five years more of maintenance. So you know, there's just a lot of factors and things that you need to consider and that the judge considers when awarding special maintenance.

Ryan Kalamaya (18m 22s):
Yeah, I think that people need to understand that it's really hard to make plans when you have this uncertainty because Eric, you know, he may say I'm going to retire at the age of 66 years in eight months and that's full Retirement age. But he may not end up doing that cuz he loves to work. And especially if he goes through Divorce and he doesn't, you know, he's, he's not great at making friends and his kids are grown up, then he might decide to continue working and, but how do we create systems or agreements that are win-wins for Eric and Melanie. That's one of the hardest things about what I think we do Amy where we don't wanna disincentivize Eric to work if that's what really he wants to do.

Ryan Kalamaya (19m 4s):
But also at the same time, you know, should Melanie benefit from that if, and then there's no easy answer from that because it really kind of depends on the facts and circumstances. And I think just people need to understand it's not just clear cut of I can just retire and quit and that's it, it's just done. Because they could go, I, I frequently see retired, you know, people working on the mountain up here in the mountains, you know, for skiing or they might go back to part-time. I mean frequent characterization for our industry is of counsel and it could be someone that works part-time as a lawyer or in some other capacity. And having that second career and how you address that I think is one of the more difficult issues in Retirement with Spousal maintenance.

Amy Goscha (19m 51s):
Yeah, And I think just kind of to wrap up, another thing that really resonated is it's not just about income, right? I mean it's about, well you know, like what other benefits is the person going to get or what assets are they getting and what income is gonna be generated? And to really look at when you're looking at the need of the spouse who possibly would be getting maintenance. So it does get complicated on, well when is someone stopping working or not? But also what are the other, you know, sources of income and benefits, Retirement benefits

Ryan Kalamaya (20m 22s):
And one of those sources of income could be if someone gets remarried later on in life and what happens in that circumstance and there's marriage of bolds, there's interim marriage of Albi in terms of how much can, if Eric gets remarried, how much can Melanie get into Eric's new wife and what assets she brings to the marriage between Eric and her. And that really is subject for another episode, but it brings in that Retirement what happens in those circumstances. Cuz you know, we do see it where people have been in a long term marriage and they're unhappy and then they quickly turn around And, they get remarried because it happens with a fair degree of frequency and how you address that because it can matter for Retirement and income.

Ryan Kalamaya (21m 15s):
So hopefully that is helpful for people to understand those issues. And as always, thanks again for joining us on Divorce Altitude. Until next time, see you around. Amy Hey everyone, this is Ryan again. Thank you for joining us on Divorce at Altitude. If you found our tips, insight, or discussion helpful, please tell a friend about this podcast. For show notes, additional resources or links mentioned on today's episode, visit Divorce at Altitude.com. Follow us on Apple Podcasts, Spotify, or wherever you listen in. Many of our Episodes are also posted on YouTube. You can also find Amy and me at Kalamaya.law or 970-315-2365.

Ryan Kalamaya (22m 1s):
That's K A L A M A Y A.law.