Beyond the emotional complexities inherent in any separation agreement, high net worth divorce comes with its own unique set of challenges. From the sheer complexity of cataloging extensive assets to distinguishing premarital from marital property, the territory is rife with potential roadblocks and points of contention.
So the good news is we will tell it to you straight.
If you (or your spouse) are a high net worth individual, your divorce will likely be challenging to navigate.
After all, it wasn’t easy to get to where you are; breaking it down and divvying it up won’t be either. Even with an iron-clad prenuptial agreement, high net-worth divorce is a sensitive and exceedingly complex process that requires time, patience, and–most importantly–EXPERTISE.
While an exhaustive list of considerations in a high net worth divorce is best discussed with an experienced divorce attorney, here are five of the most important do’s and don’ts to keep in mind as you enter into the divorce process.
Typically in a high net worth divorce, at least one spouse is financially sophisticated. If you are considering divorcing your partner, or suspect your partner is considering divorcing you, it is in your best interest speak to a lawyer proactively and promptly–BEFORE those papers get served.
An experienced high net-worth divorce attorney will most likely refer you to a forensic accountant, a professional who can investigate, collate, and track you/your spouse’s financial movements and holdings. We aren’t implying your partner has been or is hiding things from you. But it is important to have a full, detailed account of your marital/financial state of affairs.
Being armed with more information, as opposed to less, will always be to your advantage.
Divorce can be emotionally devastating, regardless of whether you are on the serving or receiving end of those papers.
But just as in business, allowing emotion to drive your decisions is extremely ill-advised.
Simply agreeing to settlement terms for the sake of getting out fast can have a devastating impact on your financial future. In that same vein, attempting to punish or enact revenge on your partner for the pain they have caused will not serve you in the long run, either.
It may sound harsh, but divorce needs to be treated similar to the dissolution of a business. Here is where enlisting the help of an experienced divorce team is essential. Your lawyer, financial planner, tax advisor, real estate broker, etc., can provide you the objective, knowledgeable perspective you need to carefully consider and evaluate all the short and long-term implications of all settlement options.
The reasons for this do/don’t should be obvious. Attempting to hide or conceal assets or liabilities is unethical and has the potential to destroy your most important asset: credibility. And chances are good your spouse is taking the exact same steps you are: hiring an attorney, a forensic accountant, etc.
In today’s hyper-connected world, hiding anything is extremely difficult, so just don’t do it. If you have built a good divorce team around you, trust that they will help protect your interests and fight to secure the future you see for yourself.
Divorce isn’t just about dividing up what you and your spouse currently have. It involves preparing for potential income and expenses, ongoing obligations, present, and future tax liabilities…the list goes on.
Again, this is where your divorce team comes in. Your attorney, along with a trusted financial planner and tax advisor, will guide you through all the nitty-gritty details. Not only will they help you draft your financial declaration, but they will also play a pivotal role in helping you understand the myriad of ways your divorce can affect your finances now and in the future, and help you evaluate all the short and long term effects of settlement alternatives. They are there to ensure the best possible outcome for you.
No two divorces are alike. Your marriage and financial situation is unique to you; laws change, judges change, opposing counsel can change. While starting with friends for recommendations is not a bad idea, use your judgment when choosing your legal representation and other advisors. An attorney who your business partner recommended for their estate and will might not be the right fit for you.
You also get what you pay for when it comes to building your divorce team. Choosing someone because they are inexpensive could be one of the most expensive mistakes you’ll ever make. Your personal and financial future rests in the hands of your team; taking short cuts to save a few dollars is risky business.
Lastly, choosing the “meanest” attorney you can find to “stick it” to your spouse or milk the most you can out of your divorce is inadvisable. Remember, a lawyer that does no-holds-barred business is ultimately in business for him/herself.
You want a lawyer who will always have your best interests in mind, not his bottom line. A good attorney will fight hard for you, but should not create conflict or extend battles that are unnecessary or detrimental to your case. Knowing which battles are worth fighting is a sign of a truly great attorney.
As you may have noticed, the running thread throughout this post is this: it all starts with your divorce attorney.
The right attorney will not only have experience and expertise in high net worth divorce but can give you access to a network of professionals who will help ensure the best outcome possible for you in this complicated and difficult process.
If you live in the greater Pitt County area and considering divorce and would like to know available options, please contact Irons & Irons P.A. Attorney Gib Irons is available to consult with you over the phone or in person. Consulting with Attorney Irons will help you to understand your options and guide you down the path of learning what is going to be best for you. To schedule an initial consultation, please call 252-215-3000 or fill out our contact form. Protecting your Privacy ~ Your privacy is our primary concern. At Irons & Irons, we understand the importance of protecting your privacy and will never share your contact information with a 3rd party.