How to Reduce the Cost of Filing for Divorce

Minimise Divorce Costs Through a Series of Sensible Measures

May 17, 2009

Filing for divorce can be a long, bitter and expensive process. Discover how a few simple changes can reduce divorce costs and prevent any further headaches.

Getting divorced is hard for anyone as it involves emotions and regularly becomes a very bitter and long-winded process. To make matters worse, the cost of filing for divorce can cost thousands. According to a BBC News report, "The average cost of ending a marriage through the British courts is about £13,000." However, making a few changes can reduce divorce costs significantly.

Is it Possible to Reduce the Cost of Filing for Divorce?

A BBC News report on Jo Gideon covered how she reduced her divorce costs to £1,130. Divorced four times, she managed to keep the cumulative cost to below £15,000. Ms Gideon said: "I did a spreadsheet of all my indebtedness and tried to break it up into what I perceived as being joint indebtedness and my ex's, and to look to see reasonably, going forward, who could be expected to pick up what."

Act Swiftly to Reduce Divorce Costs

The longer legal proceedings take, the higher divorce costs will be. Marilyn Stowe, the senior partner at Stowe Family Law, stated that, "Issuing an application to court, timetables the case and can save legal costs in the long run." Early preparation, finding essential paperwork and planning will help to save money when filing for divorce.

Avoid Filing for Divorce at the End of the Financial Year

Filing for divorce just before the end of the financial year provides little opportunity for effective tax planning. This can push-up costs as it doesn't provide sufficient time to identify the most tax-efficient arrangements. Asset transfers don't attract capital gains tax, provided that they take place during the year that the separation takes place.

Benefit from Collaborative Law

This process involves both parties sitting around a negotiating table in order to discuss all of the relevant issues. This forces both parties to negotiate in order to reach an amicable resolution without attending court. As fees are incurred on an hourly basis, costs can accumulate if an agreement cannot be reached relatively quickly.

Try to Avoid Mesher Orders

A Mesher order concerns the postponement of the sale of the family home until a specific event occurs, such as re-marriage. This serves to create money problems further down-the-line. It may be preferable to own a large percentage of a more modestly priced property than to own a small share of a house that will eventually need to be sold.

Avoid Accepting Low Offers Just to Minimise Divorce Costs

It is common practice for a spouse to make a low out-of-court offer to a partner because he or she realises that further legal costs may not be affordable. Whilst filing for divorce is an emotionally and financially trying time, it is rarely a good idea to accept a low offer simply to be able to move-on. Marilyn Stowe stated that: "In exceptional circumstances, the court does have power to make costs orders."

Filing for Bankruptcy to Escape Personal Debt Obligations

A number of bitter spouses are deliberately filing for bankruptcy in order to avoid divorce costs and debt obligations. It is important to take the case to court should insolvency be a strong possibility. If the spouse does declare bankruptcy, it is still possible to stay in the family home for 12 months and to claim a share of any available equity. An arrangement can also be made to buy-out the spouse's share.

Check Bank and Credit Card Statements

Angry and bitter partners often use joint credit commitments to make expensive luxury purchases in order to get revenge when they find out that their spouse is filing for divorce. However, the court can add back any money that has been deliberately wasted, but it is important to check bank and credit card statements in order to be aware that this has happened.

Filing for divorce is a stressful and upsetting time for anyone. There are more than just emotional matters to deal with, there are pressing financial issues as well. Be aware that a spouse may be in the process of filing for bankruptcy in order to get revenge. Check bank and credit card statements for malicious purchases. Quality, efficient planning will help to minimise divorce costs.

Disclaimer: This article in no way attempts to give legal or tax advice. One should consult a licensed attorney, tax advisor, or other qualified professional.

The copyright of the article How to Reduce the Cost of Filing for Divorce in Divorce is owned by Asa Ghaffar. Permission to republish How to Reduce the Cost of Filing for Divorce in print or online must be granted by the author in writing.