Most couples spend more time planning their wedding than they spend understanding their marriage.
That’s not a criticism. It’s just true. The venue, the guest list, the flowers — these things get months of careful attention. The financial and legal structure of the partnership those decisions celebrate? Most couples never discuss it at all.
Prenuptial agreements serve several purposes, but the most important of all is that they encourage couples to have difficult financial conversations before they get married.
And the consequences of not having these conversations can be high.
The legal cost of divorce in the United States is staggering. This aligns with national averages. According to Prudential Financial, the average cost of divorce for people without children is just over $10,000 and the average cost for people with children is $15,000.
FindLaw reports that the average cost of legal fees for divorce in Washington can be $10,000, or more.
Yet, most people don’t account for the hidden costs.
Time off work to meet with lawyers.
The hidden toll on productivity that follows people into their jobs and their relationships for years.
The cost of refinancing the home.
The consequences of splitting retirement savings or having to change your retirement plan.
Lost health insurance coverage and the cost of having to go on COBRA.
Estate planning updates.
The tax implications of asset transfers. Some asset transfers are taxable events, and some are not—and it can be expensive to get it wrong.
Then, there are the emotional costs. The cost of therapy and counseling for you and your children.
The divorce tax can also be an intergenerational tax. According to Couple and Family Psychology: Research and Practice, “Marital conflict and divorce have also shown to be associated with negative child outcomes including lower academic success.” Not only does the divorce tax leave couples with less money to support their children, but the emotional and social impact of divorce can impact children of divorce for years.
When you add it up — not just the legal bills, but the full economic impact — divorce carries what financial planners sometimes call a “divorce tax.” A cost that didn’t have to exist or at least didn’t have to be this high.
In working with families across Washington state, we have helped hundreds of families navigate collaborative divorce. And we can tell you from direct experience: most of the divorce tax is optional. Much of it can be avoided — especially when couples plan.
The best way to avoid paying the divorce tax is to avoid getting divorced in the first place.
What many couples don’t realize is that many of the reasons couples get divorced stem from preventable causes. If divorce is so preventable, why aren’t most couples able to prevent it?
In this article we’ll explore the following topics:
- What Does Divorce Actually Cost?
- Lost Productivity is Significant
- Why Couples Pay the Divorce Tax: The Cost of Divorce
- Failures of Communication Begin Before Most Couples Even Get Married
- The Case for Prevention: Prenuptial and Postnuptial Agreements
- Postnuptial Agreements: It’s Not Too Late
- What Happens When There’s No Plan
- An Honest Word About Our Process
- The Bottom Line
It can be helpful to investigate the leading causes of divorce, first.
What Does Divorce Actually Cost?
Local and national averages can include simpler flat-fee divorces, which can deceptively skew averages lower. Averages can fail to account for clients with business assets, private practices, vested stock options, and high-net worth, which can increase divorce costs.
In a contested divorce that uses traditional litigation, total costs—attorney fees, court costs, financial experts, mediators brought in late in the process, and other professional services—can exceed $10,000.
Based on our attorneys’ experience with families in western Washington, litigation and hearings can lead to costs exceeding the $10,000 national average.
If a case goes to court, lawyers typically charge additional fees per hearing, and the varying number of hearings can also increase costs.
That gap—$10,000 versus $100,000 or more for the same legal outcome—is what we mean by the divorce tax.
But attorney fees are only part of it.
Lost productivity is significant.
According to Oregon State University and University of Minnesota researchers writing in the journal, Organizational Psychology, individuals going through a divorce experience lower mood at work, lower job performance, and poorer health.
In our conversations with clients, this loss shows up in obvious ways: time away from work taken for attorney meetings, court appearances, and mediation sessions scheduled during work hours. It also shows up in less obvious ones — the cognitive load of ongoing conflict, the anxiety of uncertain outcomes, the energy spent managing the emotional impact on children.
There are also the secondary costs that don’t appear on any bill — two households where there was one, retirement accounts divided earlier than planned, a home sold at the wrong time, and the need to rebuild financial reserves that took a decade (or more) to build.
The divorce tax is real. And for families in the middle of it—it can feel inevitable.
It isn’t.
With careful prenuptial and financial marriage planning, couples can avoid the divorce tax and potentially protect themselves from divorce in the first place.
Why Couples Pay the Divorce Tax: The Causes of Divorce
According to research published in the Journal of Family Issues and a formal survey of marriage and divorce performed in 2002, the top reasons for divorce included:
- Growing Apart (55%)
- Communication Issues (53%)
- Disagreements about Finances (40%)
- Infidelity (21%)
- Incompatibility (19%)
- Drinking and Drug Use (10%)
What’s surprising is that infidelity was only cited in 21% of divorces, while communication issues and disagreements about finances were cited as contributing factors in nearly half of all divorces.
What this tells us is that many divorces can be prevented with better communication skills and better financial planning. And if we look closely at the other factors leading to divorce, like “growing apart,” “incompatibility,” or “infidelity,” we suspect that many of these issues are likely often symptoms of a breakdown in communication.
Failures of Communication Begin Before Most Couples Even Get Married
Failures of communication begin before most couples get married.
Marriage is a legal contract that can restructure a person’s finances, income, assets, and future liabilities. Yet, most people don’t fully understand the terms of the marriage contract, or even that the terms of this contract can change if they move to another state during their marriage.
According to the Harris Poll, only 15% of married couples report that they’ve signed a prenuptial agreement. This means that as many as 85% of married couples are signing a legal and financial contract without fully understanding the terms of the contract.
According to a financial survey published in several major news outlets, as many as 51% of couples get married without ever discussing finances.
Prenuptial or even postnuptial financial discussions are important and can even be more important than any other asset protection strategy you already have in place.
Marriage can impact everything from your estate planning strategy to your asset protection strategies. When a couple gets married, property and income gets reclassified as separate or shared marital property.
In Washington state, for example, any income either spouse earns during the marriage is considered shared marital property, regardless of whether it goes into a separate or shared bank account, unless the couple has signed a prenuptial or postnuptial agreement stating otherwise.
Marriage can impact business finances, even if you started the business prior to getting married. And if you have children from a prior marriage, remarriage can impact your children’s inheritance rights.
The Case for Prevention: Prenuptial and Postnuptial Agreements
The most effective tool for reducing the divorce tax is also the one that makes people uncomfortable to discuss: the prenuptial agreement.
We understand why. In our culture, prenups carry an association with distrust, pessimism, or — at their worst — a hedge against commitment. That framing is both unfair and inaccurate. A well-structured prenup is less about predicting failure than it is about treating marriage as the significant financial and legal partnership that it is.
Consider the analogy that many estate planning attorneys use—we don’t buy insurance because we expect to total our cars. We buy it because we’re making a meaningful investment and we want a clear plan in place if something changes. A prenuptial agreement operates on the same logic.
It can be helpful to think of the marriage contract as a “boilerplate” financial agreement. This agreement may work for some couples, but if you have a complex financial situation, you might need a more specific agreement to protect your finances.
Here’s what a thoughtful prenup does (and it doesn’t all relate to divorce preparation).
What many people don’t realize is that a carefully crafted prenup can protect your assets during your marriage.
- Protection from Exposure to a Spouse’s Liabilities. One spouse brings significant debt into the marriage and the other earns a significantly higher income. When the couple gets married, half of the higher earning spouse’s income can be exposed to their spouse’s financial liability. Without a clear prenuptial asset protection strategy, more of the marital income could be subject to collections.
- Business Liability. The couple’s liabilities could impact a business owned by one of the spouses. And if the business ends up having liabilities, these can end up affecting marital finances. When one spouse owns a business, or plans to start a business or private practice, prenuptial asset protection is an important consideration. This protects not only marital finances from business liabilities, but also can protect business investors, shareholders, and co-owners from marital liabilities or marital claims.
- Retirement. If one spouse is significantly older or younger than the other partner, the couple may need to carefully discuss retirement planning. If one partner has significant retirement savings, while the other doesn’t have a plan, it’s important to discuss shared retirement goals, and savings plans.
- Children from a Prior Marriage. If one or both spouses have children from a prior marriage, the couple may want to discuss whether marital income will go to supporting the children, and how children from a prior marriage will affect estate plans, and retirement plans, especially if the children need ongoing support into college and adulthood.
- Professionals. If you or your partner plans to pursue a professional course of study, it can be a good idea to discuss how student loans and the costs of professional certifications will be handled during your marriage. For example, will student loan debts be a shared marital responsibility or the sole responsibility of the partner receiving the certification or education? A prenuptial agreement can help formalize this agreement, especially in Washington state where any debt acquired during the marriage can be considered shared marital debt.
- Inheritance. If one spouse will receive a significant inheritance, it can be helpful to discuss this with your spouse, so expectations are clear.
- Raising Children. If you plan to have children and one spouse will stay home to care for the children, it can be wise to discuss how you’ll handle this major change. Will the spouse earning income set aside money to contribute to their spouse’s retirement? Will the income-earning spouse set aside money for training and re-certification for the stay-at-home spouse when the children get older?
- Military Service. Military spouses face unique challenges. They might reside in multiple states throughout the course of their marriage. One spouse might have access to significant retirement benefits and pensions, while the other might not due to frequent relocation and career disruption. Where do you want your “home base” to be? What state laws will govern your marital property and income? How will you handle relocations that could impact your spouse’s career and licensure? How will you handle retirement?
- Relocation. Moving to another state or country during your marriage can impact the tag-along-spouse. If this is something that will happen during your marriage, it’s wise to discuss the financial and social implications of such a move.
- Defining Separate and Shared Marital Property. One of the most time-consuming and expensive aspects of divorce proceedings is tracing and classifying assets. Which accounts existed before the marriage? What happened to an inheritance that was deposited into a joint account? A prenuptial agreement that addresses these questions in advance removes them from dispute entirely.
- It can protect both spouses, not just the wealthier one. A prenup can include provisions that protect a stay-at-home spouse’s access to financial resources, define support obligations, and ensure that a career sacrifice made for the family is recognized — not litigated over years later.
- It’s insurance that can dramatically shorten divorce proceedings if they occur, and potentially reduce their costs. When the major questions about asset division and financial expectations are already answered in a legal document both parties signed with independent counsel, the contested terrain shrinks significantly. Fewer disputes mean fewer billable hours, faster resolution, and far less exposure to the divorce tax.
In a review of collaborative cases handled in our practice over the past several years, cases involving prenuptial agreements resolved faster than comparable cases without them. That’s not a coincidence — it’s the math of having a framework already in place.
Postnuptial Agreements: It’s Not Too Late
A common misconception is that the only opportunity for financial planning is before the wedding.
Postnuptial agreements — legal agreements made after a marriage is already in place — offer much of the same protection as prenups. In Washington State, postnuptial agreements are recognized and enforceable when properly executed. They can be executed at any point in a marriage.
They’re especially useful when circumstances change significantly: one spouse receives a large inheritance, the couple starts a business, one spouse goes into private practice, a career is significantly scaled back to support family, or the couple simply reaches a point where they want to be more intentional about their financial structure.
They can also be a vehicle for strengthening your marriage.
There is something clarifying about sitting down with a spouse and working through the financial expectations of your partnership — not in a moment of crisis, but deliberately, with support from attorneys and marriage and family counselors who are genuinely trying to help you build a framework that works for both of you.
This is exactly what we help couples learn to do in Truce Law’s workbook, a collaborative project we created with Scott Liebert, a marriage and family therapist at Eunoia Counseling. Download The Executive Household workbook. Receive a copy when you sign up for Truce Law’s newsletter. Get the frameworks high-earning families use to protect assets, reduce conflict, and run a household that works.
What Happens When There’s No Plan
The families who face the highest divorce tax are almost always the ones who never anticipated needing a plan.
Consider what contested litigation looks like.
One spouse hires an attorney and files for divorce. The paperwork is filed and served, at which point the other party gets their own lawyer. The attorneys go back and forth, and what gets submitted to the court for review can sometimes include personal details that no one wants to share in a public forum, especially a court.
The attorneys gather financial documents, exchange disclosures, and attempt to reach agreement on division of assets. If they can’t agree — and when emotions are high and trust is broken, they often can’t — either the couple ends up in mediation (which is required in King County if you have children) or the matter goes to a judge who has no personal knowledge of the family. The process is public, the timeline is unpredictable, and the cost keeps climbing.
This is the path that most people take, because it’s often the path their first attorney conversation sends them down. If that attorney is a litigator, the litigation path feels inevitable. It often isn’t.
There is another way forward.
According to the Harvard Negotiation Law Review, collaborative divorce can help clients find fair and reasonable outcomes. The collaborative process models effective communication strategies. This can lead to better long-term co-parenting relationships and to “healing the family.”
The difference, in most cases, comes down to whether there’s a framework in place — and what kind of divorce lawyer they spoke to first.
An Honest Word About Our Process
We’re not going to tell you that working with Truce Law means your divorce will be easy. It won’t be. Divorce is hard no matter how you approach it.
What we can tell you is this: in our experience working with families across Washington state, the cases that go most smoothly — that preserve the most financial resources, protect the most privacy, and create the most workable arrangements for children — are the cases where the couple came in with some shared understanding that they wanted to do this differently.
Sometimes that understanding comes from a prenuptial agreement made years earlier. Sometimes it comes from an early conversation with the right attorney. Sometimes it’s simply a shared commitment to keeping things as collaborative as possible, for the sake of the kids.
The divorce tax is real.
It’s also largely preventable.
Planning earlier rather than later — whether that’s a prenup, a postnup, or simply understanding what your options look like before a decision has to be made — is consistently the most effective way to protect yourself, your family, and your financial future.
The Bottom Line
Divorce carries a cost that most people underestimate until they’re inside it. Legal fees of $50,000 or more, measurable losses in workplace productivity, and secondary financial consequences that ripple for years — these aren’t hypothetical. They’re what the contested litigation path regularly produces.
Careful planning consistently produces better outcomes at a fraction of the cost. The gap between those two paths is the divorce tax.
And unlike most taxes, this one is mostly optional.
If you’re thinking through what your options look like — whether you’re considering a prenup, concerned about a marriage that may be heading somewhere difficult, or just want to understand what collaborative divorce involves — we’re here to walk through it with you.
The divorce tax is real — and most of it is avoidable with the right plan in place. Ready to talk through your situation? Book a Case Evaluation and connect with a prenuptial agreement attorney.
This article is for educational purposes only and does not constitute legal advice. Every situation is unique. For guidance specific to your circumstances, consult a licensed family law attorney in your area.