As part of a divorce settlement, you may be ordered to pay alimony to your former spouse. You could also be asked to make child support payments for several years into the future. These payments are designed to ensure that a former spouse or a child has what he or she needs to maintain a reasonable lifestyle.
You may need to purchase life insurance
As part of a divorce settlement, you might have to purchase a life insurance policy. The policy would provide a spouse or minor child with money that can be used to pay for a home or college tuition. While no one wants to think about their death, buying insurance minimizes the chances that someone you still might care about struggles financially.
Determining how much coverage you’ll need
An attorney can provide an educated guess of your support obligations based on an estimate of your life expectancy at the time of the divorce. Let’s say that you were ordered to provide $5,000 a year in alimony, and it was also estimated that you would live for at least 10 years.
In such a scenario, you would likely be required to buy an insurance policy that offers up to $50,000 in coverage. As time passes, it may be possible to reduce the amount of coverage that you need to maintain. This might lower the amount that you have to pay each month to keep the policy intact.
If you are going through a divorce, it may be a good idea to have a family law attorney help handle your case. Legal counsel could make sure that any final settlement helps to meet your needs both now and many years into the future.