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Bad economy, fewer divorces

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The potentially huge cost of splitting up is causing a growing number of couples to tough out bad marriages, even if they have to live in separate bedrooms.

The recession and economic turmoil is creating a new class of casualties: married couples who can’t afford to get divorced. In these tough times, many people are finding it’s cheaper to stay together, even when they can’t stand each other.

“The reason that the economy has such an enormous impact on divorce is that most people in the middle-income brackets are getting by on whatever income they have. They’re just getting by,” said Bonnie Booden, a family-law and divorce attorney in Phoenix.

A major factor in the divorce downturn, Booden said, is that divorcing couples have to establish two households with current funds — sometimes a prohibitive factor in hard economic times.

Booden said half of her clients are seeking consultation because the couples can’t afford to get divorced. They want to know what other options they might have.

“I tell them about the process, about the cost and what a reasonable outcome might be. And once they hear the cost, and especially how you have to duplicate two households on the same money that currently funds one household, they try to think about some other options,” Booden said.

Splitting bedrooms and kids

Some clients have split up bedrooms and continued to live in the same house, she said. Some share child care duties so they don’t have to deal with each other and plan to live that way until they can figure out what to do.

“And I’ve had people who just throw in the towel and get divorces anyway, creating financial ruin for themselves,” Booden said.

Circuit courts across the country report downturns in the number of divorce and separation filings. Cook County’s Circuit Court in Chicago saw a 5% decrease in filings — about 600 cases — in the first three quarters of 2008 compared with the same period in 2007. Similar drops have been reported in other cities across the country.

This domestic situation was also confirmed by a poll by the American Academy of Matrimonial Lawyers. The group surveyed its members — all divorce lawyers — and found that 37% of them had seen a decrease in the number of couples seeking divorces, while just 19% had experienced an increase in divorce cases.

Gary Nickelson, the president of the group, said people are just “toughing it out” and putting off decisions to divorce until the economy gets better.

“We’re in a perfect storm as far as the divorce business is concerned,” Nickelson said. “It’s not a surprise to me. That’s been my experience over the last 35 years. When you have an economic downturn, people are not so quick to change their situation.”

Out of options

Some people who come to Booden’s office have come from marriage counselors, she said. By the time these couples get to her, she said, they’ve pretty much run out of options.

Typically, she said, she tries to arrange a deal in which both parties continue to own their house. She’ll split up the equity and apply an interest rate to it to make it reasonable to the person not living in the house, and then distribute the cash when the house is sold after the kids go to college.

“People have to realize the financial meltdown changed everything,” she said.

That sentiment was echoed by Nickelson. “As long as stocks and financials and major assets are down, you’re probably going to see a lot of people wait to file for divorce. There’s a lot of fear in filing for divorce,” he said. “I think that cuts across all genders, races and all social-economic ranges.”

Credit: Marty Orgel
Source: MSN

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