5 Ways to Avoid Financial Trouble Because of a Divorce
June 18, 2020
It is not surprising that many people suffer financially when a divorce reduces their household income. Nearly one-third of Americans do not have money set aside for an emergency, so the cost of a divorce lawyer can overwhelm some people. Anyone living paycheck-to-paycheck needs to stay cautious about finances before and after a divorce. Here’s how.
1. Keep It Friendly
An amicable divorce benefits everyone involved. The divorcing couple and their children have less stress because of fewer arguments, and the legal process costs less. People that fight will need to consult with lawyers more often, negotiate lengthier contracts, and potentially spend more time in court.
A deep breath and a willingness to negotiate can help to reduce the animosity and lower some expenses. People may not always get everything they want, but they will also not have extensive legal bills like arguing couples with lengthy divorces.
A contested divorce can cost several thousand dollars. Couples that fight will often spend over 17 months
to finish their divorce. Settled out of court, the entire ordeal usually ends within nine months and costs much less.
2. Choose Cheaper Divorces
Options exist to allow people to have a divorce without an enormous bill to a law firm. Couples can do all the paperwork on their own, file the court fees, and forgo any help. A do-it-yourself solution, however, does not offer a lot of protection for those who have assets to divide and children involved.
Another possibility is to choose a family law office that offers alternatives. Clients can use the firm for only detailed agreements rather than every phase of the process. Rates between law firms can vary too, so carefully check the hourly cost and other fees.
3. Divide Everything Fairly
People often worry about how they will divide their assets, but how they divide their debts matters too. The decisions become clouded when people blame each other for the bills or when one person feels the other did not make as much money as needed. Try to set these disagreements aside and create a sensible plan that shares the responsibility fairly.
Consider the option to liquidate all assets. It may seem difficult, but selling belongings can sometimes enable people to become debt-free. Less debt is preferable to living alone in a large home meant for a family or paying back a car loan based on two incomes.
4. Establish Child Support
About 27 percent
of single parents live in poverty. The parent with primary custody of the child or children will typically have more expenses related to child-rearing. The cost of a larger home, more food, daycare expenses, and more can add up quickly. A fair child support agreement benefits not only the custodial parent but the children too.
Child support amounts decided by the state do not always adequately cover expenses. Sometimes, they can force the non-custodial parent to pay more than they can afford. Parents need to set aside their personal opinions of their soon-to-be ex and do what they can to make certain the needs of the child take priority.
5. Follow Divorce Agreements
Future court expenses can clean out bank accounts and make it impossible to pay the bills. Avoid the need to return to court by following the original divorce agreements. Try to negotiate together if support amounts need to change or other changes seem necessary. Negotiate together to amend the original order rather than begin a drawn-out court battle.
Couples only feel increased resentment when they stay together because they think they cannot afford a divorce. At Budget Divorce Center
, we offer lower rates and individual services for couples that need a thriftier option than the traditional divorce lawyer. Contact us to learn more.
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