This is the first of what I hope to be many blog entries on my website. I realize that prospective clients and existing clients are likely to visit the website, and therefore this is the best place outside of social media where I can present my thoughts on the issues relating to the area of law I practice. If you are reading this, I hope that my musings and opinion will give you some idea of where I am coming from when I represent clients.
Divorce is an ugly word. At once, it suggests the failure of a relationship, the separation of a family, and the end of a way of life. It is an uncomfortable word that most Americans go out of their way to avoid. While all of us know media statistics (i.e. half of all marriages end in divorce), people often fail to consider the implications of divorce until they, or their loved ones, are faced with one. When I decided to write an article on this issue, I thought for a long time what I should say considering this hard reality, and what uncomfortable details of the whole process I could address in order to prevent further harm to those facing divorce.
As a family law attorney, I find myself in an interesting position. Entering my mid-30s, I am now attending many friends weddings each year, and yet, at my office, I am confronted daily with the consequences of failed marriages. It’s a surreal experience. This past June I attended a wedding in the morning and represented a client at a hearing for final separation the afternoon of the same day. Here, I could take the time to reiterate all that has been said about what it takes to maintain a good relationship, and preserve a marriage. However, my job is to mitigate the damage of a marriage that has already failed, and so I would like to share the following insight: at the end of any marriage, there is almost always at least one person that is not prepared to end the relationship, and neither person typically has any idea of how to go about ending the marriage without a degree of mental anguish and financial trauma. If people spent even half the time that they spend on planning a wedding preparing for the divorce, then everyone would be better for it.
When a couple plans a wedding, the first step is budgeting. The same should be true of divorce, and yet budgeting is almost always ignored. Although a couple might see a divorce coming from the proverbial “mile away,” divorce, unlike marriage, is typically not a mutual endeavor. Moreover, the fear and shame of divorce often prevent people from having an honest discussion regarding the process. Many couples avoid preparing for divorce in any way until the fateful day arrives when one of them finally admits, “I want a divorce”. The repercussions are, more often than not, disastrous.
The main problem with this lack of planning is that divorce is expensive, even if the couple chooses not to hire attorneys. Most people have very little knowledge of their own finances. In many cases, only one partner is responsible for paying the household bills. For the other partner, there is little understanding of what monetary contribution is necessary to maintain the household. The problem of not knowing one’s personal financial obligations is compounded by a lack of savings and large debts. In 2019, USA Today reported that the average cost of healthcare per person is $8,047.00 per year based on per capita spending. Many couples in their 30s and 40s also carry student loans. In 2018, the average individual debt load for student loans amounted to $37,172.00. As of 2018, 44 million Americans owed more than 1.5 Trillion in student loans alone. According to the St. Luis Federal Reserve, as of 2016, the median income of a two-income household reached just over $61,000.00 per year. If childcare is factored into costs, it becomes evident that most families have little to no flexibility in mitigating expenses and have only marginal ability to save. This fact is delineated by national household wealth statistics, which show that the median net worth was just $97,000.00 in 2019 (according to Marketwatch). If you take into account that most of the wealth is typically locked into the equity of a family home, it is evident that there is typically very little liquid wealth available for short-term expenses.
Looking at emergency savings, experts have found that 27% of all families have no emergency funds whatsoever, with 23% having enough funds to last 3 months, and a further 21% with enough liquid savings to last 6 months. (based on Financial Security index provided by bankrate.com). Given these stark statistics, it is not surprising that when a couple seeks a divorce, the result is typically a large financial gap in available funds to service existing family debts and the new costs associated with divorce.
For example, if the husband may decide that he wants to live on his own and immediately move out when served with a divorce, the results are often a doubling of typical expenses. Now instead of having a single gas and electric bill and a single mortgage, there are the added costs of husband’s rental and its associated expenses. The result: missed payments on the mortgage, missed payments on the credit cards and student loans, and multiple late fees and penalties that can quickly spiral out of control.
While not knowing one’s finances and not having enough money ready to move forward with a divorce can be distressing enough, I often see clients who have had no communication with their spouse on how to divide their assets. While most clients expect their attorney to figure out a fair division of assets and debts, the attorney cannot make fundamental decisions in the case. Often, what is legally possible and what parties can agree to can be two very different things. By waiting to discuss the issue, couples often inadvertently make the dissolution process a much more lengthy and expensive process than it need be.
To those readers to have family or loved ones that are thinking about a divorce, I hope that my message is taken to heart. It is better to discuss the uncomfortable subject of divorce before starting the process because once that process starts, it can take on a life of its own. Before making the decision to file a divorce, make a plan. Figure out what your expenses are, separate them into essential expenses and those that can be cut if need be. Look at your savings and allocate at least $10,000 for transitional expenses. If you have no savings, then it is even more important to discuss how things will go once a divorce is filed. Finally, talk about your assets, a possible custody arrangement if you have kids, and how to coordinate pick-ups and drop-offs. As modern families live complex and busy lives, planning and communication can make a divorce more bearable, and can often ensure that the failure of a marriage does not mean financial ruin as well.