The real cost of divorce in Canada
No one who walks down the aisle ever imagines that they might one day end up divorced, but the numbers are bleak. In 2008, nearly 41 per cent of marriages were projected to end in divorce before the thirtieth wedding anniversary, according to Statistics Canada. Those rates have remained fairly stable for the last two decades, fluctuating between 35 per cent and 42 per cent.
Besides the emotional impact, divorce can pack a financial wallop.
According to Canadian Lawyer’s 2011 legal fees survey, the cost of an uncontested divorce ranges from $1,006 to $2,547, with the average being $1,353. A contested divorce, meanwhile, can cost anywhere from $7,208 to $74,122, with the average cost being $12,875.
Those fees don’t include disbursements, according to Canadian Legal Resources Centre, a paralegal services company. Disbursements typically entail costs such as the court filing fee and process serving.
Here’s an example of what those fees might look like in Scarborough, Ont., for a simple divorce, according to the firm Fleury, Comery LLP:
Issue application (court fee): $157
Search registry (government fee): $10
Process server: approximately $64
Motion for judgment (court fee): $280
Court clerk for filing attendances: about $56
Certificate of divorce (court fee): $19
Court fees vary among provinces and territories. “Discoveries, appraisals, mediation, domestic specials, and financial audits are other examples of add-ons that can cost hundreds and thousands more,” the Canadian Legal Resources Centre website states. And don’t forget a lawyer’s charge for emails, phone calls, and photocopying.
Ottawa family law lawyer Jeffrey Behrendt says that even if a divorce doesn’t go to court, legal fees can easily reach the $10,000 mark. “A case that goes to court will cost you at least $10,000; more realistically it will cost at least $20,000 if it does not go to trial,” Behrendt writes on CanadianDivorceLaws.com. “If your case goes to trial, your costs could be at least $50,000. So, going to court is not a decision to be made lightly. Normally, after a month or so, you and your lawyer will have a good idea as to whether your case can be resolved amicably or whether going to court is necessary.
But the financial toll doesn’t end there. When couples separate, their expenses can increase by as much as $20,000 to $30,000 a year because of the need to support a second household, according to family mediator Stephen Rosenfeld, writing in a 2012 blog. That amount includes loss of discounts received (such as discounts for multi-car insurance) and the need for duplicate items for children at two homes (such as a computer, Internet access, clothing, and the like), as well as the possibility of child support payments and spousal support payments.
The tax system can add to the cost of a split, too. If parents share responsibility for their children equally, they can share tax deductions. But if the kids live with one parent more than 60 per cent of the time, the financially supporting spouse doesn’t get the deduction in the same way.
And where the children live will affect the bank balance.
If kids live primarily with one parent, the other has to pay child support, which comes from after-tax income. And primary caregivers may not be able to sustain a full-time job because of all the logistical details they now have to handle on their own: taking the kids to and from school, activities, and appointments. Alternatively, there’s the added cost of day care or after-school care.
Online tools such as My Support Calculator can give a clear sense of financial obligations for alimony and child-support payments.
So what can you do to mitigate the costs?
Service Canada notes that, if you can’t afford a lawyer, you may be eligible for legal aid. Many provinces and territories offer lawyer referral services. Family Law Assistance Services also offer programs related to divorce proceedings.
Jim Doyle, senior financial consultant with Vancouver’s Investors Group, says for those just about to embark on divorce proceedings, it’s important to look at various approaches: a litigious model, a collaborative approach, or a mediated process.
“How you choose to enter into that process has a significant effect on how you come out the other end,” Doyle says. “Imagine a litigious type of scenario. Your spouse and yourself end up with agreements that are typically not entirely desired by either side, and the situation is kind of forced onto you.
“A collaborative approach, where you’re able to talk through the situation and bring in divorce coaches to help keep emotions at bay, helps keep conversation going and you can see what the results are going to look like.”