Although couples in Tennessee planning to divorce know their lives will change substantially after the final decree, many don’t realize some of the financial implications of ending a marriage. Consider these unexpected consequences if you and your spouse are considering divorce.
Three hidden divorce costs
Individuals seeking a divorce often don’t consider the hidden costs the process will incur. These costs can involve several unexpected expenses like the following:
- Costly health insurance – Although the internet advertises COBRA and Obama-care policies as inexpensive alternatives, you will spend two to four times more for health insurance under current laws.
- Dividing retirement accounts – dividing all retirement accounts needs a QDRO, commonly known as a Qualified Domestic Relations Order. Although these are a formality and easy to obtain, they can extend the process.
- Transferring real estate and mortgage financing – Transfer taxes, fees and other small costs can add up quickly when selling the family house. Even if you don’t end up selling the property to someone outside the family, be aware of fees you may incur subject to your municipality’s rules.
How you can minimize the cost of divorce
Family law issues are not a one-size-fit-s-all deal. Every case is different, including yours. As such, divorcing couples must be aware of their parental rights, equitable property division issues and other possibilities. Many go into their divorce unaware of the hidden costs that both sides will incur. Bringing up these costs when you become aware of them is a viable part of divorce negotiations.
Work with your ex-spouse on these issues; cooperation can benefit you both. Divorce can be financially challenging, so being proactive about your situation can help both of you in the long run.