Obtaining a divorce can cost thousands of dollars in various fees, court costs and filing expenses. However, there are other hidden costs related to ending your marriage that you need to account for before the divorce becomes official. These costs may include the need to buy or rent a Texas home, obtain health insurance or replenish your retirement accounts.
You’ll need housing
After a divorce, you may have the right to take control of the family home. However, you will be responsible for paying the mortgage and paying for necessary upkeep on your own. Alternatively, you can choose to rent or buy another home, which will likely result in paying thousands of dollars in closing costs or upfront rental fees. It may also be necessary to buy new furniture or other items for your new home or apartment.
Health insurance isn’t cheap
Even basic health coverage can come with a price tag of several hundred dollars per month before accounting for medication or other expenses. While you may be eligible for COBRA coverage, that may be out of your price range on a single income. The monthly premium may be even higher if you have a child with special needs to take care of.
Retirement assets may be split
In a divorce settlement, you may lose a sizable portion of your existing retirement assets. Retirement accounts are typically considered to be a joint asset even if your name is the only one on them. In addition to the actual dollars lost, you also lose out on any compounding that they could have provided you with over the next several years or decades. Therefore, you may be forced to stay in the workforce or come out of retirement to make ends meet.
Ideally, you will begin to prepare for a divorce the moment that you know that your marriage is coming to an end. Doing so gives you more time to consider the costs involved as well as how you might be able to obtain the resources needed to cover them.