Legal Separation Explained
Legal separation is one of two status options for married individuals who have decided to stop living together and no longer wish to remain a part of the contract created when you marry. Essentially, it is a stopgap option whereby you agree to divide responsibilities while still remaining legally married and you can go back at any time and file for divorce. So, there is no finality with your marriage. The advantages for legal separation are that you may decide you want to remain married in the future, you determine whether or not you want to use your actual income for child support or whether you have your employer pay more towards your retirement for later divorce purposes, you have the opportunity to decide whether or not the financial support you receive is enough to divide your marital assets and debts, you can provide some tax benefits for you and/or your spouse while legally married , and in many cases there is no waiting period before being eligible to file for a divorce.
The disadvantages for legal separation are that you have to divide current bills and other assets now, you lose some of the same legal rights you have in divorce, you have a general lack of understanding on the legal ramifications of the legal separation and whether we get divorced later, and in some cases you must find a divorce attorney more than once (and pay him/her more than once).
The bottom line on legal separation is that legal separation from your spouse allows you to divide marital property and determine parenting responsibilities now without the finality of a divorce. This allows individuals and families to reaffirm their choices before going through the process of dividing property and parenting rights. And, in many cases, increases the possibility of obtaining a negotiated settlement of these issues.
Factors Affecting the Cost of Legal Separation
When it comes to legal separation, several key factors can significantly influence the final cost of the process. One of the most important is the complexity of separating assets. This can be a straightforward process, such as when the parties have few assets or have come into the relationship with attorney-mandated prenuptial agreements. However, if complex property division is a central factor in the separation, legal fees may be higher as a result. Additionally, the length of the separation can impact total costs. A couple may choose a trial separation to see if divorce is truly the answer. While doing so allows them to remain legally married and sets a legal precedent for asset division, custody, or child support should they decide to end their marriage later, it does involve legal fees for drawing up and managing the original separation agreement.
Legal separation is often a more complicated legal matter than divorce. While divorce laws vary relatively little from state to state, state laws governing legal separation differ greatly. States such as Utah, Pennsylvania, Virginia, and Texas are among those that require couples to go through a period of legal separation before moving forward with divorce. Others allow couples to file for legal separation even while they are already living apart. Depending on the state, the entire process and its associated costs may differ significantly from one jurisdiction to the next.
Hiring an experienced family law attorney is essential if you’re interested in dissolving your marriage through legal separation. Your lawyer will not only coach you through the various phases of separation and divorce but educate you on important issues such as legal separation laws, grounds for separation, and separation period. He or she will also help you avoid viewing the process on a purely emotional level and getting mired in costly costly legal tangles as a result.
Estimating the Average Cost of Legal Separation
The average cost of legal separation can range from several hundred dollars for an uncontested case in a state with minimal requirements, to several thousand dollars for legal separation and divorce in states with mandatory waiting periods or extensive discovery requirements. The national averages here do not indicate the average cost of legal separation within a particular state.
A survey by Nolo.com in 2022 found the average nationwide for a divorce with a child was $19,900.96 or $13,800 per spouse. This was up from 2021, when the national average was $13,500.
According to the 2022 Nolo.com Survey, the average legal separation without children is about $5,500. Using this as a barometer, you can see that the legal separation costs can be significantly less in some states allowing you to move forward more expediently.
Average legal separation without children
Approx. national average costs by state
Below are some examples:
Mississippi: $2,617
Alabama: $3,363
Delaware: $4,974
Arizona: $6,700
Massachusetts: $8,953
California: $9,100
As you can see, the range of costs is significant. Even in the case of a legal separation where the couple has no children, costs can vary by several thousands of dollars.
If you have children, you should also expect to pay more for a legal separation due to the additional legal steps required to reach an agreement on custody and support issues. As an example, the average cost of a legal separation with a dependent child in Mississippi is $5,700. In Massachusetts, the average is $14,097. The average statewide cost of a separation with a child is approximately double that of one without.
Of the 400 lawyers surveyed by Nolo.com, 51% say that their clients work toward a collaborative resolution of the case without a court trial, but an even greater percentage (61%) say their cases ultimately go to court to some extent, with settlement reached there on motion.
In the 2022 Nolo survey, about half of those involved in a legal separation believed they could settle their case. Only 2% attempted to resolve the matter through mediation.
Although the majority of those surveyed reported spending slightly more on their divorce case than they had expected, about a third said they spent less than they thought they would.
Hourly
Most lawyers charge for a legal separation by the hour, with the actual rate depending upon the location of the practice and the experience of the attorney. In a recent survey, the average hourly rate nationwide was $265 an hour, but the typical range for divorce cases is $150 to $500 an hour. Typically, fees are highest in larger cities with a high cost of living like New York and San Francisco, while fees tend to be lower in rural areas where the cost of living is also lower.
Some attorneys charge a flat fee to handle a straightforward case, while others charge an initial retainer fee and then bill hourly after that. Charged by the hour, clients sometimes end up paying a great deal more than a flat fee, even for a straightforward case. Just like with the national average rate of $265 an hour, if an attorney charges a flat fee, the total cost for a legal separation is nonetheless dependent upon the number of hours of work the attorney spends on the case.
Retainer
Most lawyers require clients to pay an initial retainer upon contract and then bill against that retainer. In general, the larger the retainer and the lesser the lawyer does to work on a case, the more likely the retainer will be depleted and require replenishing. Most retainer agreements give the lawyer the right to withdraw from the case if the retainer is reduced to a specified amount. Usually have hourly fees similar to the national average. Overall, the most important factor in determining a retainer agreement is the number of anticipated billable hours.
People who have a very straightforward case or one that seems complex and is not within their budget may want to consider representing themselves.
Some attorneys charge a sliding scale based on income. As a result, low-income clients pay a smaller hourly rate than those with a higher income. Lawyers often serve for a set number of hours at a reduced fee to help clients who qualify for a sliding scale.
Fixed Fees
Fixed fees are common in the case of an uncontested divorce. Many lawyers will negotiate a fixed fee to handle the entire matter for contested cases.
Tips to Minimize the Cost of Legal Separation
There are various ways of keeping legal separation expenses down. For most people, however, the factor which has by far the greatest effect in increasing or reducing legal separation costs is the lawyer’s hourly rate for legal separation matters. The second most important factor is how much time a lawyer spends on a particular case. For most people, what is not that important is whether the lawyer is a paralegal or law clerk who is billing her time at a lesser rate than the lawyer or other professional. In fact, many people believe that legal separation costs can be kept down by reducing the number of hours billed by a lawyer.
For example, a lawyer earns $200 an hour doing legal separation matters. The family law paralegal of that lawyer earns $100 an hour. Now let us take two cases, one handled by that lawyer, and one handled by his paralegal. In our first example, a separation agreement can be prepared in 3 hours while in the second example the same agreement is prepared in 7 hours. The total cost to the clients in each case is $600 and $700. The difference is a bill from the lawyer for 3 hours (a charge of $600) and 4 hours billed by the paralegal (a charge of $400). The total, therefore, is $1,000 in billings. Logic would suggest to many that the client will pay $600 ($300 per hour) or $700 ($100 per hour) but not $1,000 (which is consistent with the billings). What logic does not take into account is whether the paralegal knows how to prepare a separation agreement in this case. If not, then she may well take 7 hours to do what a lawyer will do in half the time. In this case, getting a lawyer to do the work costs $400 ($300 per hour times 4 hours worked on the agreement). If we use the fees of the lawyer, we have $600 ($200 per hour for 3 hours worked on the agreement). We have reduced legal separation costs from $1,000 to $600. We may have saved $400 but it did not decrease the total amount of legal fees charged by $400. That has not happened. Instead of $1,000, the parties who are separating by legal separation now have legal separation fees of $1,200 ($600 for one lawyer and $600 for the other lawyer). If one party had hired the paralegal instead, the legal separation costs here would have been $1,700 ($700 for one lawyer and $1,000 for the paralegal) instead of $1,200.
Before considering paralegals and law clerks, consider mediation in the costs of legal separation. If the parties involved in a separation or divorce each have a lawyer because the legal divorce takes its toll in stress, confusion and other matters which make it difficult to negotiate a separation agreement, perhaps a better way for these people to go through the process is by mediation , counseling or collaborative law or collaborative practice.
The lawyer or family law professional mediating the separation agreement is a neutral third party who focuses the discussions. She does not represent one side or the other. Her goal is to help the parties reach an agreement which will satisfy their needs. When the parties reach the agreement, then that agreement is passed to each party’s lawyer to review and if the separation agreement is acceptable, it is signed, and the lawyers then draft the separation agreement and any other materials needed to complete the the legal separation.
However, this still may lead to increased legal separation costs. It may be that mediation cannot be successful because the parties cannot agree on child custody arrangements. This is where the idea of collaborative law can help.
Collaborative law (or collaborative practice as it is sometimes called) is just what it sounds like: a collaboration between lawyers and their clients in which they agree to work together to come to an arrangement which will end the marriage. The lawyers are collaboratively trained and practice family law. The lawyers, preferably the same lawyers, meet together with the parties involved to come up with solutions to problems. If in one meeting the two sides agree on child support, the next meeting focuses on parenting times and what will be best for the children. Finally, the meeting deals with how the assets will be divided and how debts will be assigned. A separation agreement is drafted. The lawyers then help in reviewing or even drafting a divorce judgment, or may refer to another lawyer who specializes in taking divorces uncontested through the court system.
The downside to mediation and collaborative law is that the parties have to hire lawyers who are trained in mediation or collaborative law and who are willing to work to help the other side. That is a huge commitment of the lawyers. However, it is a large commitment of the parties too. This means that the parties are paying for the lawyers’ time to provide the mediation or collaborative law process. Costs are certain to go up, but costs are not going up for the lawyers involved; rather, the costs go up for the parties who hire the lawyers to work with them and also the other party.
When the issues involved in the separation or divorce appear to be insurmountable, and the parties feel that they can negotiate issues and be able to reach a reasonable and workable separation agreement, then the parties can select a lawyer or counselor to collaborate rather than mediate. Perhaps it may be best to select both a lawyer (for legal advice) and a counselor (to also help keep the parties focused). The parties can negotiate a fair resolution without getting embroiled in a courtroom battle while still having professional assistance.
Unexpected and Hidden Expenses
While most people are aware of immediate costs like attorney’s fees, a legal separation can be fraught with unexpected expenses that stretch well beyond what most people would anticipate.
Debt Obligations
Married couples typically take on a multitude of debt obligations. While some couples equitably divide such debt obligations, it is more common that one spouse is responsible for certain debts and the other spouse is responsible for other debts. In most cases, however, both spouses will continue to be "jointly and severally liable" on shared debts. If one spouse fails to make timely payments on his or her share of the responsibility, that can negatively affect the credit of both spouses. Even if the other spouse honors his or her responsibility and pays their share, any missed payments (delinquent at the time of the missed payments) will appear on both spouses’ credit scores.
Tax Issues
Are you separating in December? If you are not careful, that’s when your trouble begins. The tax year goes from January 1 through December 31 each year. If you are married on December 31, you must file a joint income tax return for that year, even if you have separated or are planning to separate the next day. For the current year, it doesn’t matter who is living in the same residence on New Year’s Eve; the IRS cares only about your marital status as of December 31. If you have children, it is important to determine who will claim the child(ren) on his or her tax return and whether to claim the Child Tax Credit. Be sure to review Internal Revenue Service (IRS) Publication 504 [PDF], entitled "Divorced or Separated Individuals," to obtain an overview of the applicable rules and how these rules apply to your specific situations. Often parents agree to alternate claiming the child(ren) on their federal tax returns and allow the other parent to claim the child(ren) for state income tax purposes. If you are not the custodial parent (i.e., the parent who has primary physical custody of the children) and you plan to claim the child(ren) on your tax returns, you must have the other parent sign Internal Revenue Service (IRS) Form 8332, entitled "Release of Claim to Exemption for Child by Custodial Parent." This form allows the non-custodial parent to claim the child(ren) on his or her federal tax return and release the child(ren) from being claimed by the custodial parent.
Insurance Considerations
Insurance is another area where issues can arise if you are separating. If your spouse has insurance coverage, be sure to get a copy of the insurance policy or policies and maintain personal copies of those policies. If you need to avail yourself of insurance coverage, having copies of the policy will save you time and money. Be sure to review your policies and understand the deductibles and out-of-pocket maximums and whether any exclusions exist. It is also important that you inform your providers of your separation as many providers will request updated information on the insured parties and beneficiaries of the policy.
Legal Advice and Money Management
When pursuing a legal separation, it is crucial to seek the assistance of legal professionals who can help navigate the complexities of the process. An experienced attorney can help ensure that all aspects of the separation are properly addressed, helping to prevent costly mistakes or misunderstandings down the line. When discussing the costs associated with legal separation, it’s essential to remember that consulting with an attorney during the process may help clients avoid disputes and legal troubles later, ultimately saving time and money in the long run .
In addition to legal guidance, it’s important to seek professional advice when it comes to financial planning. During the separation process, there may be several financial changes that must be addressed, including the division of assets and debts, child support, and spousal support. Consulting a financial planner can provide clients with ideas and plans for handling their changing finances and preparing for their post-separation future. A financial planner can also help clients create a budget and develop a savings plan to ensure that their financial future remains stable.