No one enters into a marriage with the plan of getting a divorce. Unfortunately, 39% of marriages in the United States result in a divorce, so if you find yourself contemplating divorce, you are not alone.
Divorce is an emotionally and financially challenging process, and sadly, many couples stay in unhappy relationships to avoid financial hardship. Because of the financial ramifications, it is critical to understand the costs of divorce to make informed decisions about it.
The average cost of a divorce in the United States is around $7000, although this is a complicated statistic that varies based on multiple factors and complexities. So let’s explore the multitude of factors and details imperative to determining the question: how much does a divorce cost?
Factors to Consider When Calculating the Cost of Divorce
There are numerous factors to consider while on your way to signing your divorce papers. The legal process can be pretty tasking; even with a consulting attorney, you can still break a sweat.
Often monetary factors will include:
- Court costs
- Divorce attorney fees
- Property division
- Child support
Let’s expand on the factors that affect the cost of a divorce.
Your case will require a processing fee to get started. Unless you and your spouse agree to split the cost, the spouse who files the petition is usually responsible for paying court costs. The divorce filing fees vary from $100 to $500, differ from state to state, and whether you share young children.
When children are involved, you’ll file additional documentation outlining how to move forward with a visitation schedule and efficiently co-parent if there’s no full child custody. If you decide to hire lawyers, this can take more money and time, as you’ll have to pay larger legal fees.
Divorce Lawyer Fees
Divorce attorney fees are a critical component when it comes to calculating the overall costs of a divorce. The fees associated with hiring a divorce attorney can vary greatly depending on the type and complexity of the divorce and the attorney’s experience and expertise.
Divorce attorney fees can range from a few hundred to several thousand dollars, depending on the circumstances involved. Generally, the more complex the divorce, the higher the costs.
Fair asset division is one of the main goals of divorce courts and lawyers, and is one of the diciest parts of any divorce agreement.
Suppose you and your spouse differ over who will get the family house, cars, furnishings, gadgets, or other significant assets. It can be expensive to negotiate each property distribution component in court.
Regarding divorce, one of the most important factors to consider is child custody. Depending on the circumstances, this can significantly impact the cost of a divorce.
This can be inexpensive if both parties are willing to negotiate and reach an amicable agreement on custody arrangements. However, if one parent is unwilling to negotiate and the matter must be settled in court, then the cost of a divorce can quickly escalate.
Types of Divorce and Their Financial Implications
There are several ways to obtain the decision of a court issuing an absolute divorce ruling. For the sake of simplicity, we’ll categorize each of these procedures as a separate type of divorce in the following sections. The couple must mutually agree upon the divorce and file joint court documents.
Compared to other types of divorce, a summary divorce (simple divorce) typically requires just a few formalities and is inexpensive.
Due to this, summary divorces are simple to complete without a lawyer’s assistance. Typically, you can obtain the necessary forms from the local divorce court clerk’s office or the online site of your state court.
When it comes to working with the legal system, an uncontested divorce usually presents the least amount of difficulty. That is where you and your spouse can reach an amicable agreement on issues such as child support, alimony, ad visitation (parenting time), and child custody.
The couple will then file a document, the property settlement agreement, which includes the terms of your compromise. You can petition the court for divorce when your dispute has been resolved.
These cases are nearly always expedited by courts, allowing you to finalize your divorce in a reasonable amount of time. For an uncontested divorce, you don’t even need to show up in court; instead, you can submit an affidavit to a court clerk in certain states.
If you file for divorce and your partner does not formally respond, you will be granted a default divorce. For instance, this sometimes occurs when one spouse vanishes and is nowhere to be found.
Even when your partner has yet to participate in the court processes, the judge can approve the divorce if you’ve satisfied all of the court’s guidelines and requirements.
Potentially this can result in a simple and cheaper divorce, as no one is present to dispute what you request. The court will likely rule more heavily in your favor, making the burden much easier for a divorce lawyer.
If you and your partner are at odds about one or more conflicts to the extent that you cannot resolve them, a court will be required to decide for you.
Contested divorces are painful, time-consuming, and costly due to the increased lawyer and court time required. There will be a protracted process of sending and receiving economic and other pertinent information, required settlement discussions, and, if necessary, court proceedings for short-term relief, like interim alimony.
Fault and No-Fault Divorce
This is a reference to the reasons for your divorce. Specific state laws will outline the legal grounds for divorce. In a fault divorce, individuals seeking to end their marriage must demonstrate that the opposing spouse has committed a wrong, such as an infidelity or abuse.
Of course, accusing your partner of wrongdoing can lead to a highly acrimonious divorce. But today, every state provides some kind of no-fault divorce.
In a no-fault divorce, you only claim you and your partner have “irreconcilable disagreements” or have experienced an “irremediable collapse” in your marriage rather than demonstrating that one of you is to fault for the union collapsing. This helps save on some divorce costs.
Mediation is a potential option if you need assistance resolving issues before filing for divorce. A medicated divorce is the most amicable form of Alternative Dispute Resolution (ADR).
A couple would meet with an independent third party, called a mediator, to assist in addressing the key concerns of the divorce. You won’t necessarily need divorce lawyers for the initial part of such a case, which can significantly reduce costs.
It is never the mediator’s responsibility to make decisions. Instead, mediators provide advice and aid in communication so you can reach a mutual understanding. A property settlement agreement can often be prepared after successful divorce mediation.
Collaborative divorce is another ADR alternative. This process requires working with a divorce attorney with specialized training in divorce resolution. The primary goal is to attempt to settle your case. Thus, each spouse hires their respective divorce lawyer with the hopes of cooperation.
For a collaborative divorce, each partner consents to visit with the other and their hired divorce lawyers as frequently as needed to reach an agreement and reveal all the material required for fair talks.
You must conclude that your divorce lawyer will resign and that you’ll need to seek a new one to represent you in court if your divorce process cannot be settled through the collaborative divorce. Therefore, attorneys are incentivized to reach a mutually fair agreement.
Divorce arbitration is a distinct type of ADR available in states that permit it. The arbitrator, who is usually a lawyer or a former judge, will decide on your marriage problems after hearing the facts of your case and reviewing the evidence you would normally present in court. In this regard, this option is the closest to a trial.
The advantages of arbitration include that it is frequently performed in a casual atmosphere, which is less daunting than a courtroom, often in the arbitrator’s office.
Divorce for Same-Sex Couples
All states currently acknowledge same-sex marriages due to the United States Supreme Court’s decision in Obergefell v. Hodges, 576 U.S. 644 (2015). The divorce process is identical for married couples of any orientation.
Divorce proceedings should occur in the same legal manner as heterosexual couples. If you have any concerns about these proceedings, get guidance from a nearby family law practitioner.
Financial Planning For Divorce
Divorce financial planning entails developing a business or personal financial plan that can lead to the most advantageous financial settlement.
You can make the most informed financial choices when you draw upon the vast experience of an expert qualified to deal with crucial financial decisions about divorce.
Making you aware of existing options, the value of your assets, and how your divorce-related actions will affect your earnings are the main objectives of divorce financial planning.
An Important Tip to Reduce the Financial Effects of Divorce
Handling a divorce efficiently can avoid wasting money on court and legal fees and minimize the overall costs of a divorce. If an amicable divorce or ADR option does not seem possible, obtain the proper assistance from an expert as quickly as possible.
It is incorrect to consider hiring an auditor, certified divorce financial advisor, or lawyer as an act of warfare. Receiving skilled assistance is essential due to each scenario’s distinctive elements. Also, ensure both parties understand the implications and costs of a long, drawn-out divorce proceeding.
Financial Measures to Put in Place for a Divorce
Divorce is stressful and significantly impacts many areas of life, particularly finances. Although the path to divorce is rarely straightforward, the following steps can be helpful.
Step 1: Organize yourself and compile the necessary financial paperwork
To fully comprehend all the assets you and your spouse possess jointly and individually, it is crucial to gather your copy of recent and prior financial statements to prepare for the judicial process and lawyer’s services. The following typical documents can pertain to you:
- Checking, savings, and investment accounts are assets.
- Houses, lands, and vehicles
- Debts, including mortgages, credit cards, and lines of credit.
- Telephone, internet, and insurance costs
- Accounts for retirement: Pensions, 401(k) plans, and IRAs
Step 2: Recognize your assets and debts
- After gathering your essential documents, decide what is held, like marital property, what is owed, and where adjustments are required. Here are some things to think about:
- Decide whether to keep open or close joint or personal accounts.
- Identify any areas that require name or address modifications.
- Check to see if any new personal accounts need to be created.
- Check beneficiaries on any accounts for any necessary adjustments.
- Think about updating and safeguarding your PINs and passwords on your accounts and cards.
Step 3: Keep track of your bills and safeguard your credit
Regardless of who makes the purchases, if you and your partner have joint credit cards, you can be responsible for that debt.
Remember that 35% of your credit rating is based on making your payments on time. If at all doable, decide who will cover what and keep a careful eye on that development to safeguard your credit record. To ensure that no payouts are missed, configure account alerts.
Keep an eye on your credit history to identify any accounts still under your name because you can be held accountable for such debts.
Step 4: Establish your future budget
Making a new financial plan will make you feel more poised because your expenses and income will change when your divorce becomes official.
Examine existing household costs and note any potential changes, like potential increases in daycare or insurance rates following a divorce, and potential solutions.
If you still need assistance, several apps are available to help you create objectives and alert you when your expenses are getting out of control.
How Much Does a DIY Divorce Process Cost?
A DIY divorce is the most cost-effective alternative, with the only expenses you’ll have to pay for document preparation and filing. A DIY divorce can cost between $300 and $1500, depending on the intricacy of your case, filing expenses, and the court.
The filing and court fees will be approximately $300 regardless, and the courts can request additional costs for documentation and evaluations.
How Much Does an Online Divorce Cost?
Divorce filing fees online can range from about $199 to $2,500, depending on the firm and the specifics of your case. Though the upper end of that range can appear costly, it’s still far less expensive than a legally disputed divorce via the court system.
Several online divorce attorneys charge monthly fees to cover their expenses until the divorce is finalized. Others can charge a flat fee per service.
It is common for a company to have its billing policy online. It is more cost-effective because the filing fees for a divorce with a court are not included in the cost of an online divorce service.
Divorces are not all the same, and the cost of a divorce can vary significantly depending on factors such as filing fees, attorney fees, court costs, and any property or custody agreements that must be reached.
If the parties can reach an amicable agreement, the cost of divorce can be greatly reduced. Before starting the divorce process, it is critical to consider the various costs associated with the process and fully understand the potential financial implications.
Josh is a financial expert with over 15 years of experience on Wall Street as a senior market strategist and trader. His career has spanned from working on the New York Stock Exchange floor to investment management and portfolio trading at Citibank, Chicago Trading Company, and Flow Traders.
Josh graduated from Cornell University with a degree from the Dyson School of Applied Economics & Management at the SC Johnson College of Business. He has held multiple professional licenses during his career, including FINRA Series 3, 7, 24, 55, Nasdaq OMX, Xetra & Eurex (German), and SIX (Swiss) trading licenses. Josh served as a senior trader and strategist, business partner, and head of futures in his former roles on Wall Street.
Josh's work and authoritative advice have appeared in major publications like Nasdaq, Forbes, The Sun, Yahoo! Finance, CBS News, Fortune, The Street, MSN Money, and Go Banking Rates. Josh currently holds areas of expertise in investing, wealth management, capital markets, taxes, real estate, cryptocurrencies, and personal finance.
Josh currently runs a wealth management business and investment firm. Additionally, he is the founder and CEO of Top Dollar, where he teaches others how to build 6-figure passive income with smart money strategies that he uses professionally.