If you’re considering getting a divorce, you’ll eventually need to think about the cost. This topic is not as clear-cut as much of the marketing you’ll see for legal services would have you believe. The amount you’ll pay in legal fees will depend on a variety of factors, a few of which won’t be clear until your divorce is final.
Additionally, there are a number of “hidden” costs to getting divorced. These are items that will affect you financially down the road. They’re often difficult to recognize since they vary according to each person’s circumstances. They don’t show up on any sort of price list. We’ll address these costs in detail below.
Hiring A Qualified Divorce Attorney
Divorce lawyers usually charge by the hour. Their rates vary by a wide margin based on their specialty, experience, and location. Some charge as little as $100 an hour. Others charge several times as much.
If you and your soon-to-be ex-spouse are on the same page with respect to key issues (asset division, child custody, etc.), the cost of your divorce will likely be minimal. It may require little more than filing a few forms. On the other hand, a divorce in which you and your spouse are at odds on key issues is likely to take a substantial amount of time. With the lawyer’s services billed by the hour, the more time it takes, the more expensive the process will be.
All things being equal, an uncontested divorce will always be less costly than a contested one.
Mortgage Payments And Household Expenses
Living under the same roof typically mean splitting the mortgage payments and household bills each month. When a marriage dissolves, one of the spouses typically moves out. Depending on the settlement agreement, the spouse remaining in the house may suddenly need to pay these expenses on his or her own.
There is no way to know for certain what these costs will be before your divorce is made final. Much depends on the agreement negotiated between you and your ex-spouse. Having said that, you can at least prepare yourself in advance by listing the various expenses.
Write down the amount of your monthly mortgage, your utilities, grocery expenses, and property taxes. Don’t forget to include homeowner association fees, gardening fees, and homeownersÂ insurance. If you have cable television or a satellite service, include those expenses, as well. This will provide a rough estimate of your monthly outflows.
The Cost Of Selling The Family Home
For many divorcing couples, the easiest way to address the family home is to sell it and split the proceeds. An alternative is for the spouse who is allowed to stay in the home to buy out the other party. Unfortunately, doing so takes a substantial amount of funds. He or she may not have such funds available.
If you and your ex-spouse decide to sell your home, you’ll need to pay closing costs and commissions. Together, they can eat up thousands of dollars in equity. Although you’ll receive funds from the sale of your home to pay them, both costs are worth noting.
Insurance Premiums And Related Expenses
Insurance is another expense you’ll need to take into account following a divorce. You may need to pay higher car insurance and health insurance premiums. Also, keep in mind items like auto registration renewals, car loans, and regular upkeep and maintenance for your car.
You may have enjoyed a lower car insurance rate by sharing a combined policy with your ex-spouse. Your rate may increase once your divorce becomes final, and the policy is split. With regard to health insurance, your spouse’s job may have offered extensive coverage used by your family. While your kids may still be covered by it, you will likely need to obtain your own coverage.
Your Taxes After A Divorce
After a divorce, you and your ex-spouse will no longer be able to file as a married couple. This means you’ll miss the higher deduction allowed for married couples filing jointly. In addition, the income limits at which progressively higher tax rates apply tend to be lower for those filing individually. Depending on your circumstances, this can translate into thousands of extra dollars you’ll need to pay per year in federal and state income taxes.
The cost of getting a divorce can be affordable if you and your spouse agree on key issues, such as how to divide your marital assets. But there are additional costs down the road that must be considered. Now is the time to prepare for how your divorce may affect you financially in the years to come. Consult a divorce attorney to ensure you have all the facts covered.