We believe that divorce is a good time to think about the future. What if you get sick? Will you be able to pay your medical bills? Will you be able to care for your children? Will you ever be able to retire? What will happen if your spouse is ill or dies and is not able to pay child support?
These are common questions, especially when one spouse has been the family’s primary wage earner. New Jersey law protects the lower-income spouse by allowing health insurance, life insurance, pensions, and Social Security benefits to be treated as assets. These assets can be used to protect you and your children when life doesn’t go as planned.
Health Insurance after Divorce
Federal law requires that most Americans carry health insurance. If you are covered by your spouse’s health insurance, you may find that you are uninsured after your New Jersey divorce. If you don’t get insurance, you could be penalized. There are four options for maintaining health insurance coverage after your divorce:
- Using COBRA to continue coverage on your ex-spouse’s policy for up to 36 months.
- Obtain coverage through your own employer.
- Purchase an individual health plan.
- Make health insurance coverage part of your divorce settlement.
The best plan depends on your circumstances. Melinda M. Previtera is happy to discuss the financial impact of each health insurance option.
Your children may have other options. Unmarried children may remain on a non-custodial parent’s health plan until the age of 26. Many parents include responsibility for health insurance coverage in their child support agreements.
Life Insurance
Children have a right to be supported by both parents after a New Jersey divorce. But, what happens if one parent dies or becomes disabled?
It is not unusual for the courts to require that a noncustodial spouse use life insurance as a guarantee that child support or alimony payments will continue, even in the event of their death. If life insurance s required as part of your divorce agreement, you will be named as your ex-spouse’s beneficiary on the policy for a specified term. The divorce agreement will determine whether or not the beneficiary can be changed when alimony ends or the children are grown.
Sometimes life insurance is overlooked in a divorce. When a former spouse dies, a new spouse may be surprised to find that benefits are still assigned to an ex-spouse.
Melinda M. Previtera can help you use life insurance to protect your children and your future. A life insurance attorney can help if there is a dispute after a former spouse’s death.
Pensions
If you were taking care of the home and children during your marriage, you may not have had time to save for retirement. Or, you may have focused on putting money towards your spouse’s pension because he or she had better benefits. Pensions earned during a marriage are considered marital property. This means that you may be entitled to a portion of your spouse’s pension and retirement savings. The amount will depend on your age, your income, your earning potential, and the length of your marriage.
You won’t automatically receive a portion of your spouse’s retirement benefits; you must specifically request these this benefit during your divorce. If you are awarded retirement benefits as part of your divorce agreement, you will need to file a special order called a “qualified domestic relations order” or QDRO with each pension plan.
Melinda M. Previtera can help you protect and plan for your future. Call 856-942-0150 to schedule a telephone consultation.
Social Security Benefits
While you were a stay-home spouse, you missed the opportunity to contribute towards your Social Security benefits. This can have a big impact on your ability to support yourself as you age. Fortunately, federal law allows divorced individuals to receive benefits from a former spouse’s social security record. You may be able to receive benefits at age 62, if your marriage lasted for ten years or longer and if the benefits you can receive from your ex-spouse’s record are greater than the benefits on your own record. Your own Social Security benefits, your pension, and delayed retirement can affect the amount you are eligible to receive. Also, you are not eligible for your ex’s benefits if you have remarried. If you have questions about your Social Security benefits after divorce, contact Melinda M. Previtera at 856-942-0150.
Post-Divorce Changes in Insurance and Benefits
When your New Jersey divorce agreement was drafted, employment benefits such as health insurance, life insurance, pension, and Social Security benefits were treated as assets. If your circumstances have changed, your divorce agreement may need to be up-dated for your current circumstances. Contact Melinda M. Previtera at 856-942-0150 to schedule a telephone consultation.