The Hidden Costs of Divorce in North Carolina

In North Carolina, the upfront fees for a divorce aren’t necessarily expensive. The (2025) filing fee is only $225 and other fees, such as service of process fees, can be even less. Divorce lawyer costs can be in the thousands, but not too high in the case of uncontested divorces. A bitterly contested divorce with high legal fees might cost tens of thousands or more. Nevertheless, the hidden costs of divorce are likely to exceed all of these totals by quite a large margin.

A comprehensive understanding of the total long-term cost of a divorce is critical to deciding when and whether you want to pursue a divorce. Unfortunately, there is such a thing as not being able to afford to divorce. An experienced North Carolina divorce lawyer can help you forecast the hidden cost of divorce based on the details of your individual circumstances.

Housing costs

It costs a lot to maintain a family household. Maintaining separate households costs even more—sometimes over twice as much. Below is a list of some of these expenses.

• Refinancing or selling the family home: In the typical divorce, one spouse keeps the family home. This spouse will need to refinance the mortgage to remove their spouse’s name. Refinancing will incur application fees, closing costs, appraisal fees, and prepayment penalties if you have to pay off the original mortgage early. A new mortgage might cost you a lot more in monthly payments if interest rates have risen sharply since your original mortgage.
• Relocation costs: At least one spouse will probably leave the family home. That spouse might have to hire movers, rent trucks and storage units, and purchase packing supplies.
• Establishing a second household: To establish a new residence you will probably need to pay a security deposit, first and last month’s rent, utility connection fees, and furnishings. You will probably have to purchase household goods that you once shared with your spouse such as dishes, furniture, and linens.
• Elevated household expenses: When you move out of the family home you sacrifice the efficiencies of shared living. Much of what was once shared is now doubled. Two separate households means two sets of utility bills, two homeowners or renters insurance policies, and extra maintenance, repairs, and property taxes. You might also need to pay someone else to mow your lawn or clean your house.

Health insurance

Health insurance can be a major hidden cost of divorce if you were covered under your spouse’s employer–sponsored plan. COBRA (Consolidated Omnibus Budget Reconciliation Act) is a federal law that allows you to continue your previous coverage for up to 36 months after a divorce.

Nevertheless, since you’ll be paying the full premium, including the employer’s portion, your health insurance bill is likely to increase substantially. After your 36 months are up, your insurance expenses might rise even more.

Tax consequences

A divorce carries significant consequences, including:

• Your filing status. “Married filing jointly” is a highly advantageous filing status that saves you a lot of money. Remember that once your divorce is finalized by December 31 of a tax year, you cannot file as “married filing jointly” for that year.
• Child tax credits. One divorcing spouse will lose the right to claim various child-related tax credits. This will cost that spouse a significant amount of money.
• The division of assets might require their sale, which can trigger capital gains taxes. Asset division might also require professional fees–a QDRO (Qualified Domestic Relations Order), which you need to split certain types of assets, could cost $1,000 or more in legal fees.
• Alimony is no longer taxable to the recipient or deductible by the payer for divorces finalized after 2018, due to the Tax Cuts and Jobs Act.

Overlooking the tax consequences of a divorce can lead to unexpected liabilities or reduced refunds.

Child-related expenses: Beyond child support

Children are expensive, and their needs and desires are difficult if not impossible to ignore. Below are some examples of expenses that might arise from your children’s activities:

• Childcare: If you relied on the other parent for childcare, you might need to incur professional child care expenses while they are living with you (nannies, after-school programs, etc.).
• Uninsured medical expenses: Health insurance won’t necessarily cover all of your child’s medical expenses. Co-pays, deductibles, and costs for therapy, dental work, or specialist visits might have to come out of your pocket.
• Transportation: Do you live far from the other parent? Do you have joint physical custody of your children? If so, you are going to have to shuttle back and forth for custody exchanges. That could cost you in gasoline as well as vehicle wear and tear.
• Extracurricular activities: You might find that your child’s extracurricular activities, once a shared burden, have become your sole burden, especially if you have sole physical custody of your children.

Professional fees beyond your attorney

You have no doubt already factored in divorce lawyer costs. These expenses don’t necessarily end when your divorce is finalized— or your ex might seek modification of a child custody order, for example. You might also need other professionals during the divorce process, such as:

• Financial planners/advisors
• Forensic accountants
• Appraisers
• Custody evaluators.

Planning for these additional professional costs can help you avoid financial surprises and ensure a smoother post-divorce process.

Minimizing the hidden costs of divorce

While some hidden costs of divorce are unavoidable, proactive steps can help minimize their impact:

• Comprehensive financial planning: Before and during the divorce process, work with your attorney and a financial advisor to understand all potential financial ramifications, not just the immediate legal fees.
• Full disclosure and transparency: Hiding assets or failing to disclose finances can lead to severe penalties, extended litigation, and increased costs.
• Mediation and collaborative divorce: These approaches encourage negotiation and agreement outside of court, significantly reducing legal fees and allowing for more creative solutions that can address potential hidden costs.
• Realistic expectations: Understand that your post-divorce lifestyle might change. Adjusting your budget and expectations early can prevent unnecessary financial strain.
• Clear and detailed agreements: A well-drafted separation agreement or divorce judgment should meticulously outline how all assets, debts, and future expenses (especially child-related and health-related) will be handled, leaving fewer legal “gray areas” for future disputes.
• Build an emergency fund: Having savings set aside specifically for unforeseen post-divorce expenses can provide a critical financial cushion.

Taking these steps can ease the financial transition and set the stage for greater long-term stability after divorce.

How a North Carolina family law firm can help

The main job of a North Carolina family law firm is to help you reach an acceptable resolution of your divorce case. They can also help you avoid or minimize some of the hidden costs of divorce by, for example, clarifying tax consequences, uncovering hidden assets, and properly dividing retirement and investment accounts.

Epperson Law Group, PLLC is a Charlotte, NC family law firm that has successfully navigated hundreds of divorce cases on behalf of its clients. Contact them at your earliest convenience to schedule a case consultation, where you can examine your priorities and explore your options.