Some couples in New Jersey have no choice but to get a divorce. As you likely know, every divorce costs money. However, it’s vital to watch out for hidden costs of getting a divorce.
Certain states, including New Jersey, have rules about marital property. Marital property can include assets, such as retirement accounts. However, there are costs to consider after you or your former spouse divide these assets. It can cost upwards of $1,000 to draft a qualified domestic relations order (QDRO) to make account-related changes.
Some couples must complete multiple QDROs depending on how many divisible accounts they have. Splitting up an individual retirement account (IRA) can incur manageable costs. However, the overall fees and costs of splitting multiple IRAs, 401(k) and other accounts can become quite costly.
The marital home
Many couples preparing to divorce find themselves fighting for their previously shared marital home. Regardless of what happens to this property, both parties in a divorce can pay unexpected home-related costs. Whether you or your ex-spouse continue living in this house, either situation often requires refinancing the mortgage for this property. Transferring and receiving real estate can also incur additional costs.
In a typical marriage, one person typically insures themselves and their spouse. That said, such coverage is only possible while staying married. If you divorce this person, you’ll lose the insurance coverage they provided. This means you must seek out and pay for health insurance. Depending on the coverage you had and the coverage you now want, these cost differences could be significant.
Learning about the hidden costs of a divorce can feel stressful. This knowledge can also help you prepare to go through the divorce process successfully, ensuring unknown expenses don’t take you by surprise.