The short answer is maybe.
In New Jersey, alimony can sometimes be increased, decreased, suspended, or terminated when financial circumstances change significantly. But a change in income does not automatically change an existing alimony obligation.
If you are paying or receiving alimony and want the amount changed, you generally need to establish that there has been a significant change in circumstances that justifies modifying the existing arrangement.
New Jersey courts have long recognized that certain changes in financial circumstances can justify reconsidering alimony. An increase or decrease in either spouse's income can be relevant, as can unemployment, disability, illness, retirement, or other substantial financial changes.
The important word here is substantial. A relatively minor or temporary fluctuation in someone's income does not necessarily justify going back to court and changing an alimony obligation. The court looks at what changed, why it changed, whether the change is likely to continue, and how it affects the financial circumstances of both former spouses.
This is probably the question I hear most frequently from people paying alimony: "What happens if I lose my job?"
If you involuntarily lose your employment or experience a significant reduction in income, you may eventually have grounds to ask the court to reduce or temporarily suspend your alimony obligation. But simply losing your job does not automatically reduce what you owe.
For a non-self-employed person seeking modification because of an involuntary loss of employment or reduction in income, New Jersey law requires the court to consider why the income was lost, efforts to obtain replacement employment, whether the person is making a good-faith effort to find work, the other spouse's financial circumstances, the parties' health, severance compensation, and other relevant financial changes.
There is also an important timing rule. Generally, an application based on involuntary unemployment or an inability to return to the prior income level cannot be filed until that situation has continued for at least 90 days. Depending upon the circumstances, however, a court has discretion to make relief retroactive to the date the employment was lost or the income was reduced.
The opposite situation can also arise. Suppose someone was earning $150,000 when the divorce occurred and several years later is earning considerably more. Can the former spouse simply demand a proportional increase in alimony?
Not necessarily. An increase in the supporting spouse's income can be considered a changed circumstance, but that does not mean every raise, promotion, bonus, or successful year automatically entitles the recipient to more alimony. The court still has to consider the circumstances of the case, including the purpose of the original alimony award and the financial positions of both parties.
In other words, there is no automatic rule that says, "My ex earns 25% more, so my alimony goes up 25%."
Changed circumstances can affect the recipient of alimony as well.
For example, if the person receiving alimony develops a serious disability and can no longer earn the income that was anticipated when alimony was established, that may become relevant to a request for modification. Likewise, changes in the recipient's own income or financial circumstances can potentially affect whether the existing amount of support remains appropriate.
Again, none of these situations automatically changes alimony. The person asking the court for a modification has to establish a sufficient basis for the court to reconsider the existing obligation.
This is probably the most important part. If you are ordered to pay a certain amount of alimony, don't simply reduce or stop paying because your income has fallen. Likewise, if your former spouse's income suddenly increases, don't assume your alimony automatically increases with it.
An existing alimony obligation generally remains in place unless the parties reach an enforceable agreement modifying it or the court enters an order changing it.
I've seen people create much larger problems for themselves by deciding that because their financial circumstances changed, their support obligation must have changed too. That's not how it works.
If your income, health, employment, or financial circumstances have substantially changed, talk to an experienced New Jersey divorce attorney about whether you have grounds to seek an alimony modification and what evidence you will need to support it.
If you're trying to understand alimony and the other financial issues that can arise before, during, or after a divorce, my free Divorce Smarter Course explains the New Jersey divorce process in straightforward terms so you can better understand your options before making an important decision.
Until next time,
Steve