4 Ways to Save Money During a Divorce
Most people get married thinking it will last forever, but it doesn’t always happen that way. Sometimes you find out you’re better off apart than you are together. However, moving forward with your decision to get divorced often comes with a hefty price tag. If you don’t have a solid plan in place, you could negatively impact your finances.
“If you proceed with your divorce carelessly and/or impulsively—allowing misinformation, rage, revenge, bitterness, a lack of knowledge, or a sense of futility guide your decisions—the outcome can, and probably will, be financially disastrous. On the other hand, if you proceed thoughtfully and with a strategic plan, you may find your divorce offers you the opportunity to lock in a secure financial future,” said Certified Divorce Financial Analyst Jeffrey A. Landers.
Getting a divorce can be expensive. However, it is possible to save some cash. Here are four ways to keep more money in your bank account.
1. Stay organized
You can reduce the number of times you’ll need to contact your lawyer for follow-up if you stay organized. Keep all important documents tidy and easily accessible. The more time you spend calling your lawyer to tie up loose ends and answer questions about missing paperwork, the more money you’ll spend.
“Organize your documents chronologically and by subject and be sure it’s clear what they pertain to. If we have to struggle to understand and organize your documents, this will increase your cost,” said attorney Maren Swanson.
2. Don’t rely too heavily on your divorce lawyer
Their services don’t come cheap. Attorney fees can cost roughly $200 an hour, and as much as $450 an hour in major cities such as New York and Los Angeles. Do yourself a favor and handle any duties you can easily do yourself. You can start by photocopying documents. Know you will be billed for the time an attorney’s staff takes to make copies of your paperwork. Lee Slater, a certified financial planner and certified divorce financial analyst, also warns against using your attorney as a therapist or financial planner. They are not being paid to listen to you complain about the emotional toll of your divorce or your financial woes.
3. Think about working with a divorce mediator
If you’re looking for ways to avoid divorce court, consider divorce mediation. A divorce mediator, in addition to your (and your soon-to-be ex’s) divorce lawyer, helps with coming to a resolution. Using divorce mediation is generally quicker than litigation, so this can save you big bucks in the long run. You can find a divorce mediator referral on sites such as Mediate.com and DivorceNet. Attorney Holly Clemente said mediation can help you and your partner quickly come to an agreement you can both live with:
[A mediator’s] primary goal is to assist both parties in reaching an agreement that is to their mutual satisfaction. Unlike judges, mediators often create unique agreements that deviate from the norm because the agreements are tailor made by the couple to fit their circumstances and desires. The mediator differs from the arbitrator in that the mediator can, and in fact is expected to, meet individually with each side. Hearing what each side truly wants out of the process makes the mediator’s job that much simpler, and everyone benefits…mediation is concerned with both parties working together, and doing so can dramatically decrease the billable time owed. The cost of divorce mediation is generally 40% to 60% lower than divorce litigation.
4. Get a grip on your emotions
One of the worst things you can do is let your emotions cloud your judgment. It will cost you. Instead of looking to get revenge on your spouse by fighting to collect as many marital assets as you can, focus on getting through the divorce with your finances intact. Attorney and Certified Financial Planner Violet Woodhouse said it’s important to stay calm:
No one wants to negotiate for an asset in a divorce and then be unable to sell it because they’d owe too much in taxes. Why should you go through the nightmare of settlement negotiations only to end up losing everything you fought for six months after the divorce is over? Remember: the legal process of divorce is something you live through—but the financial reality is what you will have to live with for the rest of your life. In a divorce, it’s not what you get that counts—it’s what you keep.
More from Money & Career Cheat Sheet:
- Breaking Up? What Can Happen With Your Money When the Relationship Ends
- Sex, Money, and Lies: 4 Signs of Financial Cheating You Can’t Ignore
- Credit Card Rewards and Divorce: What You Should Know
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