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Q: I'm negotiating our divorce settlement. Part of that involves finding out what my spouse earns. I have my spouse's pay stub. What else do I need? A: You also want to know about your spouse's deferred compensation arrangements (money or stock that is earned now but paid later). You should consider the value of any perks your spouse receives. These include a company car, paid travel, club memberships, dining, and so on. Perks such as these don't show up on the paycheck, but they are real income, as they make it unnecessary for your spouse to pay for those things out-of-pocket. Q: Once I learn about all that, do I know everything about my spouse's income that I need? A: Not quite. Your spouse knows that the more income he or she shows, the higher the child support (and possibly alimony) will be. So it is often the case that people manipulate their income downward in the year of a divorce. They ask their bosses to defer raises. If they work for themselves, they postpone collecting money owed to them, or simply work less. You also want to know about your spouse's deferred compensation arrangements (money or stock that is earned now but paid later). Also, in many states, a court will use the income a person is capable of earning, rather than the person's actual income, especially if the person is deliberately manipulating the income downward. So, if your spouse is deliberately reducing his or her income, you want to figure out what your spouse could be earning. Q: Can the Family Law Software Planner help me here? A: Yes. When you enter all your income and expenses into the Family Law Software Financial Planner, you can see whether you and your spouse will have enough income to get by. You can ask "what if" for each of several ways to make ends meet -- a different home, different schools, more working hours, and so on. The Planner can also graph your annual income over time and lets you enter an earnings growth rate and retirement date. If you are the alimony recipient, you can use the expected earnings growth to make the case to a court that alimony (or child support) should be increasing over time. If you are the spouse who is paying alimony, you can use the retirement feature to argue that alimony should be reduced. | |||||||||||||||||||||||||
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