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Divorce is one of the most financially draining experiences you can go through. It feels like there's a constant hum of a cash register adding on more costs as you go through the process.
Every part of your budget feels the ripple effect of divorce, so preparing yourself before starting the process can help you save hundreds, if not thousands of dollars.
This quick guide aims at helping shed light on the actual costs of divorce in the United States in 2024, so you make smart choices moving forward and keep more green in your pocket.
Let's dive into exploring different paths and how to navigate them without losing your financial footing.
First things first, before deciding how to get divorced, you need to understand the options and how much they cost.
Divorce can unfold in several ways: litigation, mediation, collaborative divorce, and online divorces. Each path carries different costs depending on your unique situation.
Divorce Litigation
Litigation is the typical idea people have of how to get divorced. You lawyer up, I lawyer up, and we duke things out in court. More often than not, this option is the most costly and contentious route.
Attorney's Fees: Expect to pay anywhere from $250 to $500+ per hour, per attorney. A full-blown trial could cost upwards of $15,000 to $30,000.
Court Costs: Filing fees, court reporter fees, and other miscellaneous fees can add an additional $300 to $1,500.
Divorce Mediation
Mediation involves a neutral third party to help you and your spouse reach agreement, often leading to less financial strain.
Mediation Fees: Typically range from $200 to $400+ per hour. Most mediations conclude within 10 to 20 hours, totaling approximately $1,000 to $6,000. Chicago based divorce mediator Kimberly A. Cook recently shared with The Divorce Planner's resident divorce prep coach Alex Beattie that mediation tends to be a third of what a problem-free litigation would cost.
Additional Legal Fees: You might still need a lawyer to review your agreement, adding to the cost.
Collaborative Divorce
Collaborative divorce focuses on negotiation with the help of attorneys and sometimes other professionals, without going to court.
Professional Fees: Similar to litigation, but since most of the work is done outside the courtroom, costs might be slightly lower, ranging from $10,000 to $20,000
Online Divorces
For uncontested divorces, online platforms offer document preparation services at a fraction of the cost.
Service Fees: Typically between $150 to $5,000, depending on the complexity of your divorce and the quality of the service. In some cases you can add additional services to your package, which will bring the final cost up.
The above just scratches the surface. For a more detailed breakdown on the different ways you can get divorced, dive into the post What Type Of Divorce Is Right For You. It's packed with meaningful information.
Hidden Expenses
Several expenses often fly under the radar, impacting your overall financial planning:
Financial Advisor Fees: To untangle combined assets, a financial advisor might charge $2,000 to $5,000.
Forensic Accountant Fees: If you think your spouse is hiding assets you might need to hire a forensic accountant. Forensic accountants charge between $300 and $500 per hour. This process can be quite complex and time-consuming, and it's not unusual for the total cost of a divorce involving a forensic accountant to be in the tens of thousands.
QDRO Specialist: Drafting fees for a QDRO (Qualified Domestic Relations Order) can range between $500 to $750.
Real Estate Costs: Selling the family home or refinancing mortgages can incur fees, often a percentage of your home's value. Working with a CDRE is a great option, and the cost of their services are included in the % they take of the final sale price of your property.
Insurance Changes: Health and life insurance costs may rise post-divorce.
Childcare: Occasional babysitting, after-school childcare, a nanny or daycare expenses can increase with a divorce.
Taxes: Ongoing or new tax fees
Now that you've got an overview of ballpark estimates of what a divorce might cost you, let's talk about how to save you money so you keep more of that green in your pocket to start your post-divorce life with.
Cutting Down Expenses: 6 Actions You Can Take To Save Money During Divorce
1. Opt for Mediation When Possible
Mediation can dramatically reduce costs and emotional toll. It fosters a collaborative atmosphere, often leading to more satisfying outcomes. Research mediators in your area, focusing on personal referrals, people with excellent reviews, and reasonable rates. Learn more in the post Divorce Mediation: A Step-By-Step Guide.
2. Educate Yourself & Be Proactive
Understanding the divorce process can save you money by reducing the hours you need from professionals. Utilize resources on The Divorce Planner’s blog and social media. Both are packed with divorce insights, ways to prepare, and interviews with divorce professionals, like: attorneys, mediators, financial planners, CDRE's, coaches, and CPA's. The blog is there to equip you with valuable knowledge to help you navigate your divorce efficiently.
3. Organize & Catalog Your Accounts, Statements & Finances
Gathering all necessary documentation of your assets and debts simplifies the process, reducing billable hours and putting everything you need right at your fingertips. Compile financial statements, asset documents, and any debt records before engaging with professionals.
The post 7 Ways To Protect Your Assets During Divorce is a great place to start the process.
The Divorce Planner's What To Gather And Log Your Assets worksheets walk you through what to do, making divorce prep a snap!
4. Consider An Online Divorce Service for Simple Cases
If your situation is straightforward, online services can prepare necessary documents for a fraction of traditional costs. Evaluate reputable online divorce platforms, ensuring they cater to your state’s laws. Just because online services tout being money savers, remember that making mistakes can add up quickly and can be difficult to correct.
But remember this, all platforms are not created equal. Having the ability to have a family law attorney look over all your information before filing, or a mediator step in if you and your spouse fall short on agreeing to all points can be a very worthwhile investment. So far, only Divorce.com has this option in all 50 states built into it's services. Research extensively before you commit.
Check out the post Considering An Online Divorce? to learn about the pros and cons of getting divorced online.
5. Negotiate With Your Spouse
Open communication can lead to agreements without heavy professional intervention and hefty billing. Before you start any conversation, make sure to educate yourself about each point you'll need to agree on, pinpoint your short term and long term goals, and identify potential emotional triggers.
Get the ball rolling with a conversation about working together to talk through a few points. Then follow up with an email that summarizes your initial conversation and set a time to either continue talking or to present your proposal in detail in a follow-up email. Having things in writing helps cut down on misunderstandings and short memories.
Don't worry if you can't agree on everything. Even having 6 of 10 points hashed out between the two of you is a win! You can always engage a mediator down the road to help with any unresolved issues.
6. Limit Courtroom Battles
Every hour in court significantly increases costs. Whenever possible, resolve matters outside the courtroom. Lean toward lower cost options like mediation and collaborative to reach agreements.
Divorce doesn't have to derail your financial future. By understanding the potential costs and strategically planning your path, you can navigate this transition with confidence and clarity. Empower yourself with knowledge, seek collaborative solutions, and take charge of your financial situation so you divide and thrive!