You may not realize this, but when you file divorce papers, you are suing your spouse for divorce. Most people have never been involved in a lawsuit before and have never worked with an attorney for anything other than a traffic ticket or to prepare their will. Fees can add up to the tens of thousands very, very quickly. If you must hire an attorney, here are some tips that will save you money.
Weigh the hourly billing rate of the attorney you choose vs. the complexity of your case and/or what you will realistically get out of your settlement. Some attorneys have high hourly rates because of a specific sub-specialty, because they are board certified in family law, or because they have many years of experience.
If their specialty is child custody, for instance, but you are seeking alimony, their fee may not justify the particular work they will be doing in your case. Some attorneys have a high hourly rate because, well, they can, and because there are people out there who think high fees equal competence.
If your case is not complex, it is probably OK to hire a more junior attorney with a lower hourly rate. Ask what the hourly rate is before your consultation.
Sorry to say, some lawyers have non-refundable retainers, and some ask for a large amount of non-refundable money up front to “reserve their time.” If you can settle quickly, you won’t get that unused portion back. If you want to change attorneys because you are unhappy with the progress of your case or the work they are doing, you will not get that unused portion back.
This happens all the time. If your attorney leaves the firm you hired, you also may not get your retainer back, and you will feel compelled to continue to work with the firm they left.
The purpose of a retainer is to be assured of payment for work performed. They should not get paid for work they do not do. Do not be afraid to talk about how their retainer works in detail.
In North Carolina and most other states, the courts require mediation before child custody and equitable division trials. Save yourself a lot of fees and try to mediate early in the process.
A mediator can use their trained skills to bring up issues that are preventing settlement and help find solutions that parties can agree upon. Better yet, instead of attorneys, consider using a Certified Divorce Financial Analyst as both a financial neutral and a mediator.
You don’t want to pay hundreds of dollars an hour for someone to wade through a disorganized mess. Put them in a binder and provide an index. Attorneys need to inventory all incoming documents and usually will want an index as well.
Also, ask how they want you to provide documents; hard copies of documents, electronic copies, or both. You don’t want to pay a professional for the job of scanning documents. Save yourself a lot of money and perform this sweat equity yourself.
This one is obvious.
Attorneys and paralegals charge in 10 or 15-minute increments, so that email that they read in two minutes could cost you $100!!! If you have a question that is not legal, try asking their secretary.
Not only can you see where your money is going (and that it is going), but what they are doing and how your case is progressing. That might help you avoid a phone call or email to your attorney.
A Certified Divorce Financial Analyst can and should handle the financial aspects of your divorce, and can do it more knowledgeably, thoroughly, and affordably than your attorney or their staff. For instance, one of the first things your attorney will want is a Financial Affidavit where you provide your income and expenses and your assets and liabilities.
(Note: Financial Affidavits are called different things in different states. For example, in New Jersey it’s called a “Case Information Statement (CIS)”; in Utah it’s a “Financial Declaration”; and in New York it’s called a “Statement of Net Worth.”)
It’s important this document is correct, because it is the basis on which your support payments and asset division will be determined. A Certified Divorce Financial Analyst can help you make sure your budget is thorough and your affidavit is accurate. He/she can also check to see if there are errors in your spouse’s Financial Affidavit.
For instance, in the case of employee income reported on a W-2, often income can be incorrectly reported by counting the wrong number of pay periods or deducting too much in taxes. 401(k) contributions and healthcare premiums need to be added back to gross income, as well as any other payroll deductions. A Certified Divorce Financial Analyst can check for those types of common errors.
If you haven’t hired an attorney yet, then consider contacting a Certified Divorce Financial Analyst to help you settle your divorce affordably. Hiring a CDFA is the best advice I can give you on how to save money in your divorce and how to avoid high attorney fees.
When you use attorneys, the settlement is based on a current snapshot of your financial situation. The benefit of working with a CDFA is that he/she will look not only at the present, but how the settlement will affect you in the future. That’s very important when there is spousal support because it’s important to know if you will have enough income once support stops.
You can read on my website about the many reasons why hiring a CDFA is an emotionally healthier and financially smarter alternative.
What advice would you give others so that they can save attorney fees? Was your attorney clear about how much your divorce would cost? Do you wish you had sought out financial advice or used a mediator instead?