It may be more beneficial to obtain a lump sum up front rather than an equal amount of payments given to you over several years if the sum of the payments is equal to the one-time payment, mainly because you would be able to invest the lump sum and earn interest on the amount that remains invested. Also, if the lump sum is defined as a "distribution of assets," as opposed to "spousal maintenance," you will owe no taxes, but on the other hand, no tax deduction will be available by the provider. But there are a few cautionary notes:
As always, be sure that you review any agreements with your attorney and a financial specialist, such as a Certified Divorce Specialist (CDS) and/or Certified Divorce Financial Analyst (CDFA).
Connie Walsh is a Certified Financial Planner and Certified Divorce Financial Analyst who heads Divorce $olutions, part of Walsh Financial Services. Connie brings approximately 25 years' experience in the financial industry, including 12 years on Wall Street, to her practice.