Money and divorce statistics: how does divorce affect your financial situation?

1 min readLast updated March 28, 2024by Unbiased team

Discover how divorce can impact your short- and long-term financial situation and how to manage your money after the dissolution of your marriage.


  • The AACFL reports that the average cost of divorce is around $15,000, but it can exceed $100,000 for complex, litigated cases. 

  • Finances are a driving factor in divorce; 86% of couples married for five years or less got married while in debt.  

  • GAO reports that after divorce, a woman's household income drops by an average of 41%, almost twice the drop experienced by men. 

  • Hiring a divorce lawyer in the U.S. averages $270 per hour, costing $11,300 for full-scope representation, impacting financial settlements. 

Money and divorce rate statistics 

Up-to-date money and divorce statistics shed light on the challenges that estranged couples face on the financial battleground.  

The financial toll of divorce is a significant aspect to consider.  

On average, the cost of divorce hovers around $15,000, though this figure can skyrocket to upwards of $100,000 for those involved in complicated, litigated divorces.  

Age plays a pivotal role in divorce statistics in the US, with approximately 60% of divorces involving individuals aged between 24 and 39.  

Digging deeper into age-related dynamics, couples around 30 years old, on average, are more likely to experience their first divorce. Moreover, among those under 20 years old, 27.6% of women and 11.7% of men find themselves navigating the challenging path of divorce. 

In the broader context of divorce rate statistics, 2021 saw a total of 689,308 divorces across 45 US states. Concurrently, 1,985,072 marriages occurred during the same year, resulting in a US marriage rate of 6 per 1,000 people.  

Divorce and money are closely interlinked, as money matters can stir up trouble in marriages. When couples find themselves tangled in financial disagreements, it often comes with a hefty price tag. 

This financial weight tends to echo through the relationship, sparking money-related arguments for about 41% of couples dealing with consumer debt. 

Interestingly, of all couples without debt, only 25% say that they argue about money. Money doesn’t even make the top-five list of things debt-free couples argue about. 

The trajectory of bringing debt into marriage reveals a concerning trend, particularly among younger generations. While 43% of couples married for over 25 years started their marital journey in debt, a staggering 86% of couples married for five years or less initiated their union in the red.  

How does divorce affect your finances? 

Firstly, the financial hit is different for everyone.  

After divorce, a woman's household income typically drops by a substantial 41%, almost twice the decrease experienced by men.  

There's a shift when it comes to taxes and divorce statistics in the US.  

In 2020, married couples filing jointly enjoyed a 10% tax rate on the initial $19,750 of taxable income. However, if you were filing separately, that 10% rate only applied to income up to $9,875.  

For those whose marriages lasted beyond a decade, there's a silver lining: access to up to 50% of your ex-spouse's Social Security benefit. It's a financial lifeline that can provide some stability as you navigate the aftermath of divorce. 

Legal representation during divorce proceedings comes with its own financial considerations.  

When both parents opt for legal assistance, the median spending on the divorce and custody process skyrockets to $18,000 - more than double the cost when only one parent seeks representation.  

Surprisingly, when neither parent has legal representation, the median spending drops significantly to $500.  

What are the hidden costs that should be considered when getting a divorce? 

Delving deeper into money and divorce statistics is essential to uncover the less obvious costs that require careful consideration and planning.  

The long-term costs of divorce  

Looking at the long-term financial aftermath of divorce, the numbers tell a compelling story.  

Starting with retirement accounts, the National Institute for Retirement Security reveals a noteworthy difference. The mean value of independently owned defined-contribution retirement accounts stands at $84,874 for married men, but for divorced men, it's $58,951.  

Divorcing before hitting the 10-year marriage mark isn't just about emotional strain; it can also result in losing access to spousal benefits or survivor benefits from Social Security.  

Older studies paint a stark picture, indicating an average 77% drop in wealth post-divorce.  

This decline isn't just about dividing assets but also the ongoing costs of maintaining two separate households. 

Hiring a divorce lawyer 

Choosing legal representation during divorce proceedings is common, but it comes at a cost.  

Money and divorce statistics show that the average fee for a divorce lawyer in the United States is $270 per hour, with a total cost averaging $11,300 for full-scope representation.  

While the costs of hiring a divorce lawyer may seem daunting, the potential for a more favorable financial settlement often outweighs the initial investment.  

A study by Money Magazine showed that individuals who enlisted the help of an attorney during their divorce secured an average of 50% more in financial settlements compared to those who went the DIY route. This underscores the significant impact legal representation can have on the financial outcomes of divorce. 

Getting health insurance 

The aftermath of divorce and money issues often ushers in changes in health insurance coverage.  

Surprisingly, despite 71% of couples typically having joint health insurance, a study conducted by the University of Michigan estimated that around 115,000 women annually lose their private health coverage due to divorce. 

Enter the Affordable Care Act (ACA), providing an option that wasn’t available when the University of Michigan conducted its study.  

The ACA offers insurance coverage based on income through the Health Insurance Marketplace, boasting a range of plans without discrimination based on pre-existing conditions. Despite the last open enrollment period concluding in 2014, Americans facing coverage loss due to divorce have a 60-day window for enrollment, providing a vital safety net during uncertain times. 

In cases where traditional health insurance remains financially elusive, extended Medicaid guidelines present an alternative. Available for single individuals earning less than $15,521 per year (or $20,920 for a family of two), Medicaid becomes a pivotal resource in post-divorce healthcare planning.  

Splitting retirement accounts 

According to the NIRS, independently owned defined-contribution retirement accounts reflect a mean value of $50,126 for married women, contrasting with $38,613 for divorced women. 

Understanding the broader picture, changes in marital status can have lasting effects on finances and savings.  

Among those who have been married once, approximately 35% have no retirement savings. Meanwhile, 60% of those who have never married and 40% of those who have married more than once face the same situation.  

Additionally, 4 in 10 individuals who have been married once boast $100,000 or more in retirement savings, a significantly higher percentage compared to 2 in 10 of those who never married and 1 in 3 of those who married two or more times. 

This pattern persists when we look at men and women separately.  

When married once, both genders are less likely to have no retirement savings and more likely to have $100,000 or more in retirement savings. This starkly contrasts those who have never been married and those who have been married two or more times. 

Housing costs 

Deciding on housing post-divorce is a multifaceted process.  

Typically, one partner retains the property, but nuances like deed transfer costs and taxes are crucial considerations, with potential exemptions requiring financial advice from an expert.  

This is a common issue that needs resolution, as 53.4% of people divorced in 2022 owned their own homes, while just 46.6% were renters.  

Selling the marital home is common, and it can exclude up to $500,000 in profit from federal capital gains taxes, introducing substantial financial implications. 

Notably, divorce rate statistics are high, with around 50% of first marriages and a remarkable 70% of subsequent marriages ending in divorce. In 60% of cases, this leads to the family home being listed on the market, emphasizing the significant housing shifts that come with divorce.  

Get expert financial advice 

Money and divorce statistics prove that divorce is a financial rollercoaster. From the hefty average costs to the surprising stats about age groups, debt battles, and long-term effects, the financial fallout is undeniable.  

As you navigate the complexities of divorce and money, remember that financial advice from a trusted financial advisor can provide tailored solutions and strategic insights, empowering you to make decisions that align with your unique financial goals and aspirations. 

Unbiased can match you with a financial advisor who can help you to successfully manage your money and make informed and strategic decisions for your future. 

Find a financial advisor now


Unbiased team

Our team of writers, who have decades of experience writing about personal finance, including investing and retirement, are here to help you find out what you must know about life’s biggest financial decisions.