Does Spousal Support/Maintenance Terminate upon Retirement?

 Posted on February 02, 2022 in Divorce

If you or your ex-spouse is planning to retire soon, you may be wondering how it may affect your maintenance obligation or award. In general, maintenance is modifiable unless you and your ex-spouse specifically agreed upon divorce that maintenance would be “non-modifiable” which is rare (and actually considered a property settlement). Depending on what the divorce decree says, the payor spouse may still have an obligation to pay maintenance even after they retire. For example, if you were ordered to pay permanent maintenance to your ex-spouse, that obligation would likely continue even after retirement but possibly with a substantial reduction, depending on the circumstances of your case.

Illinois law contains several scenarios in which a maintenance obligation would automatically terminate including the remarriage of the party receiving maintenance, the death of either party, or the cohabitation of the party receiving maintenance with another person on a resident, conjugal basis.  What is important to note is that the Illinois Marriage and Dissolution of Marriage Act (“IMDMA”) does not contain a provision that allows maintenance to automatically terminate upon retirement.  Termination is different than modification, however, and the statute does afford the payor spouse the ability to file a petition with the court seeking to modify their maintenance payments based upon their retirement or other reason they are unable to pay the ordered amount.

Section 510 of the IMDMA Act provides that a maintenance obligation may be modified or terminated “upon a showing of a substantial change in circumstances.” When determining whether a substantial change in circumstances exists, the court can consider the change in employment status of either party, such as retirement, or the increase or decrease of either party’s incomes. If, upon your retirement, the payor’s financial circumstances and resources do not change significantly, and their income will be similar to what they were receiving before they retired, then their spousal support payments will likely continue to be the same. By contrast, if the payor can show that their financial circumstances have drastically changed as a result of their retirement, such that they can no longer afford to continue paying spousal support at its current amount, then the court can order that your maintenance payments be reduced or terminated completely. However, whether a modification or termination of maintenance will be granted is highly dependent on the facts of each individual case.

Generally speaking, retirement is considered to be a voluntary change in employment for purposes of maintenance. For that reason, Illinois courts are often apprehensive when dealing with requests to modify or terminate maintenance based on retirement. When a reduction of maintenance is sought based on a change in employment status or reduced income as a result of retirement, the court must consider whether the employment change was made in good faith. Courts do this because they want to avoid awarding reductions or terminations of maintenance where an ex-spouse is intentionally attempting to avoid their support obligation. 

For example, if the spouse paying maintenance retires earlier than the customary retirement age without a convincing reason such as a health condition, then the court may deny a request for a reduction or termination in maintenance.  One guideline for retirement age is the Social Security benefits age for that individual, which varies based upon the date of birth.

Keep in mind though that simply retiring at the customary retirement age may not be enough to necessarily warrant a modification of your maintenance obligation. In any proceeding involving the modification or termination of support, the court can also consider all other relevant factors including your age, health, motives for retirement, the other spouse’s ability to provide for himself or herself, and your ability to continue paying maintenance after retirement taking into account your other financial resources and assets. For example, Illinois courts have found that where an individual has sufficient assets to continue to meet his or her maintenance obligation after retirement, a reduction in income by itself, does not constitute a substantial change in circumstances that would warrant termination or reduction in maintenance.

The decision to retire is one that may require more thought when you owe a maintenance obligation to your ex-spouse and you should not expect that the obligation will automatically go away when you stop working. The payor of support bears the burden of proving a change in circumstances when seeking a modification or termination of maintenance and proving a substantial change in circumstances is not always simple or easy.  It requires a complex and well thought legal strategy. Therefore, working with an experienced attorney to help guide you through that process may be necessary. 

If you or your ex-spouse is planning to retire soon and you are interested in receiving more information on this topic, please contact our office for further assistance and a free initial consultation.