So, you have decided to get a divorce.
There is so much to think about; the reaction of your kids, your family, your friends, not to mention the sheer magnitude of change that will impact your family's life. Where will you live? How will be able to afford this new life? There is already so much to deal with. But right now, how will you be able to afford a divorce?
You have heard and read about how expensive a divorce can cost. You are already facing so many emotion and financial questions. It isn't surprising that most people procrastinate in starting the process of divorce. Sometimes it is easier to put it in a corner, and forget it exists. And it isn't just one party that holds off; sometimes it is both parties that would rather not deal with the reality of the situation.
Getting accurate information may put some of those uncertainties to rest and give you the strength to proceed and do what you know is right deep down. It is important to research all your fears in depth so you can go into this with eyes wide open and not shut. Whether it be a psychologist, life coach, mediator or lawyer. Getting the right information is the first step.
Admittedly, the divorce process isn't an easy process for anyone, but knowing what to expect is half the battle. We want to help clarify some of the unknowns, starting with how to keep the costs for divorce down and the emotions from escalating out of control. Afterall, 'knowledge is power'. So, let us get started and discuss the real cost of divorce and more importantly, the steps you can take to mitigate the negative impact on your family members, including yourself.
As I am sure you are aware, the actual cost of divorce is impossible to calculate as every matter is unique. However, generally speaking there are three areas of expenses that we will discuss further.
The first expense can be categorized as the costs associated with the negotiation or mediation process. At this stage, the parties are engaged in the process of reaching a settlement.
The Two Options for Negotions
1) The Two-Lawyer Negotiated Divorce
Both parties will each be required to provide a retainer (an upfront payment determined by the law firm in which the lawyer will draw his/her fees as they are incurred). This amount will need to be replenished as it becomes depleted. This is an ongoing expense until the matter is settled and the final account paid in full. If the parties do not continue making a retainer payment, the lawyer will discontinue representing their respective party. A Retainer Agreement will also have to be executed by both parties.
The lawyer will charge each party an hourly rate for phone calls, meetings, emails, text messages and any other communication required. They lawyer also charges for any work done by their staff including associate lawyers and law clerks. The lawyer will also charge for disbursements such as photocopies, faxes, etc.
A four-way meeting is often a first step once lawyers have been retained which includes both parties and their lawyers. The objective of this meeting to for all parties to present their positions and propose any settlement. There may be more than one four-way meeting as the matter progresses.
The lawyer's job is to reach the best settlement for their client, not their family as a whole. This costs time, money and stress on both parties. If the lawyer does not feel the settlement is in your favour, negotiations with the other lawyer will continue, sometimes for years on end. These negotiations are very expensive and will eventually lead up to trial where a Judge makes the final decision; not you, not your spouse. You will have no control over the outcome of your matter.
If we are comparing a mediation to a two-lawyer approach; the time to get matters resolved will be considerably shorter, usually within 6-7 months or even shorter. Whereas, getting to trial will take you 2-10 years.
The hourly rate of a mediator is usually less than what a lawyer may charge hourly. $250.00 per hour is a normal fee for a mediator whereas a lawyer charges $350.00 up to $1,500.00 an hour for family law matters. You will still have to pay for the mediator's time while he/she is communicating with you regarding your matter, mediation time, document preparation time as well as any disbursements such as photocopies, boardroom fees, etc. In end, it is still a considerable amount cheaper than retaining counsel to deal with your legal matter. Mediation would normally run you between $5,000.00 - $6,000.00, depending on your matter it may be less or more. A typical family law litigation matter would normally cost you $40,000.00 - $100,000.00. Most mediators will require a retainer, however, it will be much lower than that of a lawyer.
Mediation is also a shared cost between the parties, whereas when two parties retain a lawyer, they are each paying their lawyer independently.
More important is the for you to keep yourself 'in check' as to the overall cost of one process over the other. It is the cost-saving nature of the mediation process itself that will save you money.
Mediation is an efficient process; plain and simple
The mediator will meet with both parties at once, and decisions can be made on the spot, with both parties having a say in how they want their issue to play out. It is all about the parties involved, not lawyers.
This process results in a significant savings of time which extends to money and stress.
The mediator is an impartial party who helps to facilitate a resolution between the parties. The end result is a mediator, who is focused on the fairness of the mediation and ultimately, the agreement. In mediation, you both will be informed and understand the alternatives and implications of your final choices.
Costs of the Settlement Process
There are a number of costs that can include appraisals of property, renovations/repair costs, taxes associated with the sale of the matrimonial or investment homes. You may need the services of a real estate agent and/or mortgage broker to help you with securing a new living space.
You also have to factor in the costs of any financial analysts and/or accountants that you may need to retain. You may need a financial advisor to help you decide how to move forward; will you be able to maintain the marital standard of living? Will you need to make cut-backs? Will you need new employment?
The questions may mount and you will need to seek proper advice from certain professionals to help you along the way.
Costs for Document Preparation, Court Filing and Court Representation
The final cost is the preparation of the parties' agreement and once agreed upon by you and the other party, the preparation of Court documents.
There will be other costs, Court filing fees, process server fees, etc.
So, you ask what is the actual cost? The e motional impact of separation and ultimately divorce can't really be quantified in a dollar amount. There are so many variations, and as previously stated, each matter is unique in its own right.
You may be surrounded by negativity, however you should remember you can have a 'good divorce experience', if you are willing to. Mediation allows for that experience. Going to Court is adversarial and a very difficult fight. Remember, you may have to co-parent with the other party; and if you do, you definitely want to make it a somewhat positive experience. Going to Court usually, if not always, leaves a bad taste in your mouth, whether you are the Applicant or the Respondent.