How to Make Your Divorce Work for You

You don't need a judge to tell you who gets what. Here's how to save both cash and tears.

You know that getaway house on Martha's Vineyard that you and your spouse bought together? Or the retirement account with both of your names on it? If the two of you ever go your separate ways, as about half of all married couples eventually do, a judge may decide who's going to get them.

"I felt violated by the process," says Mark Hill, a financial planner in San Diego, recalling the day a judge ordered him to pay his wife's credit-card bills. "You go into divorce thinking you're in the right. She had an affair, or she was a bad mom. But all a judge sees is two warring parties who once made babies. It's not justice for all—it's arbitrary."

And if it isn't arbitrary, it's often skewed. Divorce Court judge Lynn Toler told USA Today in April that "some judges are biased toward women." And New York State Court of Appeals judge Robert Smith said last year that he suspected that men don't get a fair shake in divorce cases involving working women and stay-at-home husbands.

But in the past five years, a system for ending childless marriages outside the courts has come of age. Called collaborative divorce, the practice allows you and your ex (plus your lawyers, a neutral financial planner, and, in some cases, a divorce coach) to split your assets at a roundtable discussion rather than leave the decision to a judge who's known you for an hour. Collaborative divorce occurs through a series of meetings at which both parties discuss what they want from a settlement. The experts moderate with advice. It's a bit like a very crowded therapy session.

Whether settled in or out of court, divorce can be financially devastating: The Journal of Sociology reports that the dissolution of a marriage lowers a person's wealth by an average of 77 percent. But there are strategies for making the end of a marriage as tidy as possible.

Start the divorce process as soon as you can. You may think you need a few months—or decades—before you can sit in the same room with your spouse. But the earlier you get adjusted to the idea of not being married to each other, the more willing you'll be to spend a couple of months debating the ownership of the Ted Muehling candlesticks. This advice isn't just for your mental health: A drawn-out divorce will be more expensive. "The longer you're apart, the more likely it is to go adversarial," says Todd Curry, a certified divorce financial analyst in Charlotte, North Carolina. "You're much better negotiating now with this person, because you still have some attachment to them. You can empathize with their situation. If you can't, it's going to cost you more, because it's going to drag on."

Be honest about your finances. Even if you spent money on a below-the-radar trip to Provence with your new girlfriend, an expense like that rarely changes the financial outcome of your divorce (unless you bought her a condo while you were on vacation). "Certainly men are hesitant about turning all of that over," says Rita Pollak, a Massachusetts lawyer who specializes in collaborative divorce. "But nine times out of ten, his wife knows, and she's probably told her attorney." Don't let your spouse hide anything either—get a copy of her credit report.

Point out what your wife did wrong. Don't forget that you're in divorce proceedings, not marriage counseling—but if you need to complain about something so that you both can arrive at an agreement, then you should. That way, you, your lawyers, the financial analyst, and the divorce coach can evaluate how the information will affect the settlement. "If you're very upset because the other person is seeing someone else, or anything like that," says Felix Berenberg, a psychologist and divorce coach in San Mateo, California, "then you may bring that up as an issue, and we don't say, 'Hey, you, be quiet—we said we'd only talk about positive things.' You don't want there to be an elephant in the room." And unlike in a divorce court, be prepared to talk—and talk, and talk. The process is "very touchy-feely," says Richard, a 45-year-old owner of a real-estate company in Atlanta (who asked to be identified only by his first name). "It's sort of like when I was sitting in college with a bunch of buddies smoking pot, going, 'Now let's talk about this.'"

Know what you can use as leverage. During any negotiation it's important to be aware of what the other party wants. Your wife probably wants the house. "A friend of mine calls it the marriage museum," says Hill, the financial planner. Your vulnerable point is generally the retirement fund. "Men think, 'Dammit, I've worked for it. She's been at home in a bubble bath.'" If they're worth about the same amount now, you might be better off fighting for the fund and letting the house go. When she sells the house, she could potentially lose the equivalent of 20 percent of its value to capital-gains taxes.

Get on with your life. Disentangle your finances as soon as possible, as Richard in Atlanta did. His wife wanted eight years of spousal support; he offered one year. The compromise: two years of alimony and a lump sum to keep her going for a few more years. "I am paying less support than I would have if I had gone to court," he says. If you're the one who should be receiving financial support, try to get the same kind of deal. "You don't want to be looking at tax returns years later, trying to figure out if they earn more money," says Susan Hanson, a Wisconsin lawyer who specializes in collaborative divorce. "That's a hard corner to back yourself into." Besides, with any luck, you'll be too busy decorating your new house.

I Will Survive: 5 Tips for Ending a Same-Sex Marriage

Even with gay marriage becoming more widespread, don't count on the courts to make your breakup any easier. Most states don't recognize such unions legally, and the courts won't help you divide your possessions. But if your relationship does head south, your first step should be to call a lawyer. Gay divorce is an emerging field whose laws change constantly and vary wildly by state. The advice that follows depends on your location, but several general rules of thumb could save you from losing your shirt.

1 ) Close your joint accounts. Cancel your shared checking accounts and credit cards immediately. If you keep them open and your ex burns through cash or runs up debt, you might have to pay for it.

2 ) Do not kick him out of the house. Even if you're the sole owner of the home, you could be forced into eviction proceedings if your ex has been contributing money every month. "If there is a landlord-tenant relationship that could be argued, you can't throw him out," says Jo Ann Citron, a lawyer in Boston who focuses on divorces and breakups.

3 ) Take what you think is yours. Get your hands on the property you own—especially if your ex is doing the same thing. "If you know the other person is doing it, then you have to take yours," says Anthony C. Adamopoulos, a Massachusetts-based lawyer who advises on same-sex partnerships. But don't try to grab all the loot. "That is only appropriate if you know it's going to be a difficult breakup," he says, "and you have a reasonable expectation that you would get those things eventually."

4 ) Stay out of court. Use a mediation service tailored to gay partnerships. Mediators can help separate property, lay out who will be responsible for any joint debt and custody matters, and decide how much financial support one partner should get.

5 ) Remove him from your insurance benefits. If an employer provides your insurance, letting your ex keep his coverage might leave you open to a fraud claim. Still, don't be hasty: If you reunite with your ex, you might have to wait up to a year before you can sign him back up.


The Divorce Survival Guide

The Rise of the Financial Divorce

The Stay-at-Home Divorce

How to Survive Her Affair

Your Marriage Isn't Dead—It's Comatose

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