Hidden Costs During a Divorce to Watch Out for

As lawyers, one of the most common questions that we get from our clients is, “How much is this going to cost me?”

It’s no secret that legal fees can be costly, especially in litigious matters. Sometimes it feels like you are pouring funds into a black hole – and the longer proceedings drag on, the more money you seem to be forking out. When will it end?

As a person involved in proceedings which are likely to already be making you emotional and stressed, the last thing you would want is to also worry about paying your legal fees. It is therefore important for lawyers to be upfront about their charges and inform the client about any disbursements they may incur.

It would also be helpful for lawyers to provide realistic cost estimates to clients on the different options they have. For example, the difference in costs between a contested versus an uncontested divorce.

Legal Fees you should be aware of

1. A lawyer’s hourly rates vs. fixed price fees

• Uncontested divorces (simplified track) often come with fixed price fees because the work is generally straightforward and predictable. The law firm will stipulate what work the fixed fee will cover. The fixed price fees generally range from $1,150 to $3,500.
• Contested divorces that involve disputes over assets, custody and/or maintenance, are often charged at the lawyer’s hourly rate, typically ranging from $300 to $1,000 per hour. Fees charged at hourly rates quickly add up and can total between $10,000 to $400,000.

*Sometimes in a complex case when multiple lawyers are working on the same matter, you may be paying for a junior lawyer, associate, senior associate and/or a partner at the same time. Be aware that these costs quickly stack up.

2. Consultation Charges

Some firms offer free initial consultations, but subsequent meetings can cost $200 to $800 per hour.

3. Scope Expansion

When entering into a costs agreement with a law firm, remember to clarify the scope of work i.e. what work will the quote cover. Sometimes a law firm may quote a fee for a divorce which excludes mediation, additional affidavits or hearings. These quickly become add-ons and hidden costs during a divorce which are extra that you were not prepared for from the outset of the case.

4. Disbursements

Disbursements refer to expenses that a law firm incurs on behalf of a client. The law firm will then bill the client for payment of the same. These fees are paid to third parties for services provided to the client during the course of a legal matter and are separate to the lawyer’s professional fees, such as:

• Court filing fees
• Expert Witness fees (below)
• Land Registry fees
• Transcript fees, notarisation, certifications, photocopying and courier charges. These may be small but can quickly add up.

5. Mediation & Dispute Resolution Costs

1. a) Court-Based Mediation

The Family Dispute Resolution Programme is compulsory for cases involving children under the age of 21 years (opting for a contested divorce) and are usually free.

1. b) Private Mediation

These are voluntary but come with a fee.

1. c) Multiple Sessions

Disputes often require multiple mediation sessions, each session costing approximately $3,000 per party per day.

6. Expert Fees: Investigators & Valuers

1. a) Private Investigators

If adultery is alleged, private investigators may cost $100 to $300 per hour, depending on the complexity of the case, the duration of the investigation and the experience of the investigator.

1. b) Asset Valuations & Forensic Accountants

• Valuing a real property can cost between $120 to $700
• Forensic accounting and business valuations may range from $2,000 to $100,000 depending on the size and complexity of the business.

1. c) Psychological & Financial Experts

Counsellors, child psychologists and/or financial planners may be needed to provide reports to the Court. These fees could cost $200 – $300 per hour.

7. Maintenance & Long-Term Obligations

1. a) Spousal & Child Maintenance

You may be ordered by the Court to pay spousal and child maintenance as a result of your legal proceedings which are a long-term commitment.

8. CPF & Property Implications

1. a) CPF Repayments & HDB Sales

When a HDB is sold, CPF refunds and accrued interest are deducted first. The remainder is then split.

1. b) Retaining Property

If one party retains the HDB, you must meet HDB eligibility criteria (e.g. care of children, loan capacity). Failure to meet the criteria could force the sale of the property and rack up relocation costs.

9. Emotional Toll & Mental Health Costs

1. a) Therapy & Emotional Support

Counselling may be required for you and/or the children. These can easily cost $200 per hour and repeated sessions are likely.

10. Lifestyle Adjustments & Opportunity Cost

1. a) Living Arrangements

Post-divorce, you may have to find alternative accommodation, rent or move your children to new schools due to moving. These may be an additional expense for you.

1. b) Career Mobility & Retraining

One spouse may need to re-enter the workforce or retrain, incurring costs for courses, childcare, or reduced earnings initially.

11. Dispute & Enforcement Costs

Applications for interim maintenance, child access, or non-compliance enforcement of Court orders can lead to more legal costs.

How to Keep Hidden Costs in Check

1. Try to negotiate fixed-fee packages with your lawyer for uncontested divorces and always get a breakdown of costs in writing. Read your cost agreements carefully!
2. Ask your lawyer for an estimate of disbursements that you are likely to incur during the process of your case so you can plan for these costs.
3. Organise your documents for your lawyer – the more work you can do by yourself, the less you pay your lawyer to do it for you.
4. Attempt a Court-based mediation first (free) before exploring private (paid) mediation.
5. If finances are tight, explore the option of Legal Aid.

Conclusion

A divorce in Singapore can be far costlier than just legal fees. From mediation to private investigator valuations, maintenance liabilities, counselling and expert reports, the hidden costs stretch well beyond the courtroom. Work together with your lawyer to manage these costs and to avoid any surprises.

Disclaimer: This article is intended for general guidance and informational purposes only. It does not constitute legal advice. If you require legal advice tailored to your specific situation, please consult a qualified family lawyer.