Divorce isn’t easy on anyone, given the emotional and logistical tolls it exacts from everyone caught up in the process, but the financial burden it places on families can be especially heavy. According to a survey from Nolo, the average divorce costs around $15,500, with the bulk of the costs ($12,800 on average) accounting for attorney fees. Fortunately, there are a number of different ways you can actively minimize your divorce bills, including the following.
- Reach an agreement
You might read this advice and muse to yourself: “If we could agree on everything, we wouldn’t be getting divorced.” Fair point. But coming to an agreement about custody, division of assets, and other vital issues in a divorce case will benefit you both financially. The more you agree, the less you’ll need the services of a lawyer. Thus, you’ll be able to keep more money and assets. In theory, this advice probably resonates. In practice, you may need to compromise on challenging issues. Choose your battles wisely.
- Choose the right attorney
Divorce lawyers are not interchangeable, and attorneys’ fees are based on factors like experience, expertise, and courtroom and mediation skills honed over decades. An attorney with an excellent reputation handling complex custody battles might not be needed if you and your spouse have grown children or otherwise have no custody disputes. Review your situation carefully, and retain a lawyer with a background in the most contentious aspects of your divorce for the most cost-effective outcome.
- Use other experts to help you get a handle on your financial needs
Remember that even the most experienced divorce attorneys cannot help you with every issue pertaining to the separation. If your budget is misaligned, find and work with a financial planner to get it under control and figure out how to support yourself and your family going forward. If your career has been thrown off track by the divorce – or if you took time away from work during the marriage, and now you need to reenter the workforce – solicit help from an experienced coach or counselor.
- Collect financial records
You can save your attorney a lot of time (and yourself a lot of money) if you do some leg work on your own. Track down and make copies of the following documents, as well as any other financial records relevant to the case:
- Tax returns from the last five years
- Bank statements (joint and individual accounts)
- Brokerage statements
- Retirement fund statements
- Home and business ownership documents
- Insurance policies
- Wills, trusts, and investments
To be sure you’ve accounted for all financial records, obtain a copy of your free credit report.
- Hurry up
According to HG.org, the number one factor influencing the cost of a divorce is how long the case lasts. If you’re the stubborn one in the relationship, be prepared to let go more than you’re used to letting go for the sake of keeping everything simple and quick. Prioritize your divorce above all other responsibilities for the time being to further speed up the process.
- Don’t forget about taxes
Even after the divorce is finalized, you may be responsible for taxes on the marital assets you receive in the settlement, depending on how they are divided. Many assets can be divided tax-free. Before agreeing on the division of assets, determine the value of each asset on an after-tax basis to make sure you’re getting the best deal. It’s always a good idea to get advice from a CPA in addition to your lawyer when dealing with tax issues.
Our experienced legal team at DiPietro Family Law strives to offer the highest quality service and advice for our clients, while carefully accommodating all budget concerns. Call us now for a free consultation at (888) 530-4374 to put your divorce related financial worries at ease.