Terminating a Minnesota permanent spousal maintenance award due to retirement

Commencing August 1, 2024, Minnesota enacted new laws which provide more guidance on a spouse’s ability to retire and terminate a spousal maintenance award.

The new law, codified as Minn. Stat. 518.552 subd. 7 describes the following factors a Court is required to consider in modifying/and or terminating a spousal maintenance award:

(1) whether the retirement is in good faith or is an unjustifiable self-limitation of income;
(2) whether the party has attained the age to receive the party’s full retirement benefits
under section 216 of the Social Security Act, United States Code, title 42, section 416, or
the customary age for retirement in the party’s occupation;
(3) whether a party has reasonably and prudently managed the party’s assets since the
dissolution of the marriage; and
(4) the financial resources available to both parties

The new statute further provides a motion to modify may be brought before the retirement takes place so long as a retirement date is specified in the motion.

Presumption of not retiring in bad faith

The statute further provides a party is not presumed to have retired early in bad faith if he or she has reached the Social Security full retirement age which is approximately sixty-seven (67) years old or the customary retirement age for the retiring party’s occupation.  This presumption is helpful for district courts to better determine whether a party’s retirement is in good faith or whether the retirement is occurring in a bad-faith effort to terminate the spousal maintenance award early.

Retirement and the elimination of spousal maintenance

Modifying and or terminating a spousal maintenance award is important for retirement planning and having sufficient cash flow for the retiring party to meet his or her needs without having a continued financial responsibility to a former spouse.  Additionally, a spouse that has been the recipient of spousal maintenance will need to ensure the retiring spouse is retiring in good faith and not in an effort to prematurely terminate the spousal maintenance award.  The recipient spouse will also need to ensure he or she is able to meet their living expenses with the potential loss of spousal maintenance or alimony from the other party.  The attorneys at Gilbert Alden Barbosa PLLC are available for a free consultation to discuss options available to parties with regard to spousal maintenance and retirement.  Call now for a free consultation, 952-300-2937.