EP 99: 5 Creative Ways to Pay for Divorce

Divorce is expensive. While some listeners have the resources to pay for a divorce, others do not.  Some of you are struggling to balance day-to-day expenses with fees incurred by attorneys and other team members.

In several previous episodes, I have talked about how to pay for divorce:

This episode covers some options that have never been discussed on the show before. Way back in Episode 2, I listed four options to pay for your divorce. The fourth was “be creative.” This episode is going to cover five creative ways to pay for your divorce.

I will caution you that this advice is general, and that your specific circumstances will vary. There could be legal complications or financial consequences down the line for some of these options, so consult your attorney and/or accountant.

The five creative ways to pay for divorce are:

1) Ask friends and family for help.

Consider going to your family or friends for help. They may be more comfortable if you structure it as a loan. To set up the repayment terms, you can find a template for a personal loan online. Then you will show your friends or family members that you are serious about paying them back.

2)  Sell stuff.

Look around your home for things you could sell. You may have electronics, art, collectibles, physical goods, old cars, and cameras. They could help you get enough money to cover some of your bills and regular expenses. But be careful when selling things; your spouse may ask you to reimburse them for any joint property later on.

3) Take out a new credit card.

If your credit is good, you can consider taking out a new credit card. I do not advocate taking out a lot of debt; it always comes back to haunt you later. However, it may be a viable option if you are struggling to cover team members’ fees (or even just groceries).

4) Borrow from your retirement investment accounts.

Rules vary greatly among retirement accounts, but some will allow you to borrow from them.

  • 401(k) plan — Some 401(k) plans will allow you to borrow 20-50% of the plan’s value at a low interest rate.
  • IRA — IRAs are more difficult to borrow against. You may have to pay taxes and penalties. It is a little bit tricky. But if you have a short-term need, you can use a rollover to have access to those funds tax-free. You will need to deposit the amount you took from a qualified IRA rollover account within 60 days.
  • Investment account — You have the option of taking out a margin loan. These loans are complicated, so I do not necessarily advocate them unless you understand them.

5) Take out a home equity line.

With this option, you are borrowing against the value of your home (which must be worth more than you owe). This route requires a lot of approvals, including your spouse’s (if their name is listed on the home).


Thank you for listening to the Divorce and Your Money Show. Visit us at www.divorceandyourmoney.com for 1-on-1 coaching and be sure to check out the NEW courses Steps to Take Before Divorce and How to Get a Divorce without Losing Everything.


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Shawn Leamon, MBA, CDFA

Dallas, Texas

Shawn C. H. Leamon is Managing Partner of LaGrande Global, a firm that helps successful families manage large financial transitions like divorce, inheritance and selling a business.

He earned his Bachelor of Arts from Dartmouth College, double majoring in Economics and Philosophy, and his Masters in Business Administration at Spain’s IE Business School.

Before founding LaGrande Global, Shawn helped manage $1.1 billion in client assets at Bernstein Global Wealth Management. He also worked as a credit research analyst at J.P. Morgan. He is a Certified Divorce Financial Analyst, and he has been an advisor to numerous high-stakes divorce cases.

Shawn is the author of two well-received finance books: Managing Private Wealth: Principles, and Divorce and Your Money: The No-Nonsense Guide, both published in 2016.

In his spare time, Shawn is an ultra-endurance athlete and has competed in events as long as 24 hours. He is an Eagle Scout and a member of the Alumni Board of Greenhill School.