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Estimating Alimony in NJ

If you have a judge decide the issue, the process of reaching "the number" will be very different from the way that alimony will likely be calculated if you and your spouse settle the alimony issue on your own. 

After understanding the details of this distinction, you will be equipped with the information necessary to allow you to make an informed decision as to how alimony should be calculated in your case.

Let me explain. 

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If a Superior Court Judge determines alimony for you, there are 19 factors that the Judge MUST consider, including need, ability of the other party to meet that need, length of the marriage, standard of living...and on and on.

So, the way that the New Jersey alimony law is SUPPOSED to work is that a judge is supposed to apply the facts of your case to the law.

Then the judge is supposed to determine what a reasonable amount of alimony under the facts of your case would be.

That sounds like an awful lot of work, doesn't it? 

How does a judge even really do it?

Well, indeed, it is an awful lot of work.

It also leaves quite a bit of room for the judge to exercise discretion.

A Judge would usually start by examining each party's Case Information Statement (ie, their budget and list of assets and liabilities.)

If there is not enough money to go around, the judge may then "tweak" each of the respective budgets to try to find a balance that seems to be "fair." To do this, the judge would analyze each budgetary entry and "modify" it to something that the judge feels is more "reasonable".

For example, the budget might list "electric bill" at $500 per month, and the judge might say "well, it seems to me that there could be some savings here so I'll modify that to $400 per month."

This continues through the entire budget.

Sometimes the Judge gets it right and both sides are reasonably happy.

Sometimes the Judge gets it wrong and someone is very unhappy.

Yet...in my experience, most alimony cases settle without a Judge.

But...how?

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THE UNOFFICIAL, TOTALLY INAPPROPRIATE, YET WIDELY USED 25% FORMULA

To avoid a trial and all of the expenses and uncertainty that a trial brings, many lawyers and mediators recommend what is informally known as "the 25% formula" to estimate what a fair amount of alimony would be.

The 25% formula says that we take the difference of the income between the husband and the wife, multiply that number by 25%, and the result is the alimony number.

So for example, if the husband earns $200,000 and the wife earns $60,000, applying the formula would result in alimony paid by the husband to the wife of $35,000 per year (just under $3000 per month). 

Alimony is non-tax deductible to the payor and taxable to the recipient (with the exception perhaps of an "old" alimony order that was set under different tax rules and has now just been renegotiated. That newly revised alimony figure might be taxed differently.)

Now you already know that the 25% formula is not the law at all.

Nonetheless, the simplicity of the 25% formula remains attractive to many lawyers and mediators and, by extension, their clients.

So the practical question for someone facing paying alimony or receiving alimony ultimately comes down to, "Will it  be better for me to have the statutory factors applied to the facts of my case by a judge during a lengthy and costly trial, or might I be better off by just using the rather arbitrary but widely-accepted 25% formula?"

More often than not, most people ultimately agree to use the 25% formula, perhaps with some adjustments upward or downward to reflect either a long or a short marriage (in terms of calculating the AMOUNT of alimony, not the number of years that it would be paid.)

THERE'S A LOT MORE FREE HELP WHERE THIS ARTICLE CAME FROM

So maybe determining alimony in your NJ divorce case should be done "the wrong way".

For over 37 years, Fixed Steven PortraitI’ve helped more than 5,000 people navigate alimony issues.

I’ve seen firsthand how the right knowledge—at the right time—can make all the difference.

That’s why I created the NJ Divorce School.

It’s a free, daily email course that walks you through what you need to know to protect yourself, your children, and your finances during this process.

Each day, you’ll receive a short, practical lesson—easy to understand, no legal jargon, no sales pitches.

Just real guidance based on my decades of experience.

Many people tell me it’s the most valuable resource they’ve found during this time.

And if you decide it’s not for you? Unsubscribing is one click.

Take a look...this will really help you.

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I promise.

Click Here To Learn More About Steve Kaplan's Divorce Course