How much should maintenance be increased Y.O.Y.

Stillie

Stillie

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Hi all,

Im in the process of a divorce and i'm wondering how much year on year should the maintenance for my daughter be increased. We initially agreed to 10% Y.O.Y/ the CPI whichever is greater but now my soon to be ex wants that changed to 20% or CPI which ever is greater?

I've been having a look around and i noticed a lot of divorces say that the percentage should be CPI percentage?
 
What does your divorce contract say?

I agree though that CPI is reasonable.
 
A friend of mine has an interesting approach. They have a look at each others income and split whatever the expenses are % wised based on income. In other words if he makes 60% of their combined income he is responsible for 60% of his daughters expenses. This makes it a reasonable approach as she is a lot more careful about what she spends money on because whatever she claims (school, clothing and so forth) she needs to pay a % of.
 
CPI

Is this for your daughter only ? Because 20% sounds like quite a lifestyle increase for anyone concerned. Suppose it depends on the initial amount.

For example I pay R5k a month, plus 50% on medical / schooling, increases by CPI annually. This usually ads up to more like R8k to R10k a month.

Depends what you can afford really, but CPI is the norm.
 
What I would suggest is you control the "debt". The school, medical etc must be invoiced to you and you pay directly to them.

Expenses and living expenses are the ones where the "Ex's" normally get self funding is the difficult part.

10% is a fair amount.

Remember that the time she spends with you also needs to be taken out of the equation as you will be funding those costs.

Or be like me and I got full custody of my daughter when she was a toddler and brought her up myself with the ex moving to Australia.
 
At 20% would soon become unaffordable:
5 years from now every R1000pm maintenance paid now would be R2 488.32pm

10 years from now every R1000pm maintenance paid now would be R6 191.73pm


At 10% it looks like this:
5 years from now every R1000pm maintenance paid now would be R1610.51pm

10 years from now every R1000pm maintenance paid now would be R2 593.74pm
 
Ow. Simply put you are farked.

Irrespective of what you agree to in your divorce settlement your soon to be ex could still go to the maintenance court y.o.y and ask for an even higher amount.

I'm not trying to be a profit of doom here but in the case of a lump sum you have no control over how it is actually spent and it becomes a bit of a bottomless pit. As an alternative, why not agree to a set of expenses that you will pick up instead and reduce the lump sum that increases?

You could offer to pick up items like:
- Schooling (Specify what standard as well ie normal public, model C or private);
- Medical aid contributions (once again specify which plan or equivalent);
- Extra Mural Activities (limit it to 2 or 3 and a maximum monthly cost).

By taking care of the above you effectively remove the 10%/20%/CPI argument as each of those providers will determine their own increases. After covering those look at what you have left/are willing to contribute in terms of food/clothing/entertainment etc. and set a value to that which increases with CPI.

If you started with an agreed lump sum of say R10k subtract the fixed items above you pay directly, call it R8k, and your new cash contribution is R2k which increases with CPI.
 
Fixed amount seems like a bad idea - you don't what the rates will hold in 10 years time.

Then again CPI seems unfair...everyone knows that number is a lie.

I'd go with inflation +5 maybe?
 
Oh yes an important note to be strictly adhered to and this comes from a senior judge:-

On the settlement agreement where they ask for maintenance for the spouse/ex never put 0% as this can be increased at a later date but always put NONE.
 
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