Ending a marriage is no easy decision. While a divorce legally dissolves the marriage, a legal separation is a court order that mandates the rights and duties of the couple while they are still married but living apart. Both arrangements separate the couple financially and provide legal oversight for child custody and support, spousal support and debt management. However, a divorce completely dissolves a marriage.
If you're having serious problems with your spouse, a divorce might seem like the only way to split off and protect your finances. However, a legal separation may offer similar protection as a divorce and in some cases fit your situation better. There are personal and financial benefits to consider when determining which is right for you, so let's examine both options.
A legal separation is like putting your marriage on hold. Typically, both spouses move to different homes and start living separate lives. A legal separation is more formal than just moving apart though. You would need to get a court to approve your decision and put together a legal separation agreement. This is an agreement that divides property, sets an arrangement for raising your children, and ends the financial connection you have to your spouse.
After separation, spouses are typically responsible for any new debt they take on individually. However, if there is debt or other outstanding financial obligations that you acquired as a couple, you are both responsible for those obligations. A legal separation agreement can specify which spouse is responsible for which debt so there is a clear understanding.
A divorce actually ends your marriage. Beyond this major difference, a divorce is similar to a legal separation. You would need to get a court to approve this decision and come up with an agreement that divides property and figures out the plan for your children. Since divorce and legal separation are similar, they may cost about the same and take around the same amount of time to process.
Couples might consider a legal separation for both personal and financial reasons.
In other situations, a divorce may be preferred.
It is important to note that not all states allow legal separations. In these states, you'd need a divorce to financially split off from your spouse.
There are key differences between legal separation and divorce. And while we've outlined some of them above, your financial professional or lawyer can advise you on what would be best for you. We hope this article helps you have a more informed conversation as you work through your personal situation.
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