Strategies to protect your finances in divorce

| Jul 9, 2021 | Divorce

Divorce has a reputation for being costly. Although many couples find the benefits of divorce worth the costs, it is understandable to be hesitant about the expenses.

Massachusetts is among the most expensive states for divorce. The average divorce in the state costs $12,200, which is quite an investment.

However, every divorce presents unique needs. Some divorces are more affordable – especially if you can take advantage of money-saving strategies that may affect your long-term finances.

Avoid divorce trial when possible

One of the common sources of divorce costs involves trial fees. When the court needs to make decisions for your case in a contested divorce, it will charge you additional money to pay for resources such as the judge, the courtroom and administrative expenses. Litigation can also take a long time, which also tends to increase the legal costs.

Instead, couples can use alternative methods to make their own decisions about how to divide property, share parenting time and more. In an uncontested divorce, you both agree to your own terms. Setting aside personal differences to negotiate can significantly reduce your overall costs while giving you more control over the outcome.

Consider future maintenance, taxes and penalties

Your divorce could affect your future financial obligations, especially when you split property. Retirement accounts, for example, will typically penalize early withdrawals if you plan to cash out. If you plan to sell your house, take closing costs and other hidden expenses into consideration.

Aim for an equitable property split

Whether your divorce calls for negotiation or trial, the outcome should be fair to you. In many cases, dividing assets and debts 50-50 is not fair – even though it might be equal.

For example, if one spouse has significant medical needs, they might need a greater share of marital property to help pay for their care. Similarly, it is important to determine a fair way to divide debt. Spouses should also carefully consider whether alimony would be reasonable before finalizing the divorce.

By getting an equitable result, you can make sure that you have the maximum resources available to pay for your divorce costs and other life needs. Review all your property, debt and financial goals with your attorney to develop a customized plan for your divorce.