Most spouses who the court orders to pay alimony do so monthly. This is a similar approach to how a parent would typically make child support payments. It’s just support for their former spouse, instead.
However, some spouses do have the option of asking for alimony as a lump sum. This gives them all of the money that the judge ordered for them to receive, but they end up receiving it all at once instead of piecemeal. For instance, say a judge ordered your ex to pay $5,000 per month for the next five years. That’s a total of $300,000.
Is it better to take the monthly payments or the full sum?
A lump sum protects you from change
One of the biggest benefits of a lump sum is that it protects you financially if your ex experiences a significant change. For instance, if your ex loses their job, they may be able to ask the court to cancel or lower those monthly payments. If you take all of the money upfront and then your ex loses their job, it doesn’t make a difference to you. You do not have to give the money back.
You can also make that money work for you in a variety of ways. You could pay off your mortgage and reduce debt. You could invest it so that you actually get more than $300,000 over the next five years. You could use it to start your post-divorce life. This is especially nice if you’d rather not have to deal with your ex in the future, as the lump sum lets you both move on right away.
What is right for you depends on your situation. Just be sure you understand all of the options you have. An attorney can go over those with you as you navigate your divorce.