High-Net-Worth Divorce: Dos and Don'ts
High net worth divorce is fraught with potential pitfalls. High net worth divorce is a sensitive and extremely complex process that needs expertise. While an exhaustive list of considerations is best discussed with an expert divorce lawyer, here are the most important do's and don'ts to keep in mind as your enter into the divorce process:
- Don't file for divorce if you still love each other
- Do file for divorce if you don't love each other anymore
- Do file for divorce even if you're sure you'll get back together again
- Do file for divorce when you've already decided who gets what
- Do file for divorce before you know how much money you'll end up getting
Don’t become immobilized or reactive. Seek professional advice quickly and proactively. Typically in a divorce, at least one party is financially sophisticated. If your partner is considering divorcing you, it is in our best interests to speak to an attorney pro-actively and promptly. An experienced high net worth divorce attorney will most likely recommend a forensic accountant, a specialist who can investigate, collate, and track your/their financial movements and holdings.
We aren’t implying that your partner has been hiding anything from you. But it’s important to have a full and detailed account of your marital /financial state of affairs. Armed with more knowledge, you will always be better off than those who know less.
Agreeing to settlement terms just to get it over with or out of guilt is ill-advised. Treat your divorce like you would a business. Don't allow emotion to drive your decision-making. Be prepared to make concessions if necessary but do not agree to anything simply because you feel guilty. Divorce is very important to your life. You should consult with an experienced divorce attorney in Harris County, Galveston County, Fort Bend County, Montgomery County, Brazoria County, Houston, Sugar Land, Missouri City, and Stafford, Texas at Thornton Esquire Law Group, PLLC, before making any decisions. Your lawyer can give you the objective advice you need to make informed decisions about your case. Contact us today at www.thorntonesquirelawgroup.com for a free consultation.
Don’t try to hide or devalue assets or finances. Instead, consult with your divorce team before moving any significant financial moves or decisions. The reasons why should be obvious. Trying to hide or conceal assets and liabilities is unethical and has the potential to destroy your most valuable asset—credibility. And chances are good that your spouse is doing the same thing as you are: hiring an attorney, accountant, etc. In today's hyper-connected world, trying to hide anything is very difficult, so just don't do it. If you've built a good divorce team, trust that they will fight to secure the future that you see for yourself.
Don't limit yourself to physical property and liquid assets when calculating how much alimony or child support you should receive. Divorce is not just about dividing up what your spouse and you currently have. It involves preparation for potential income and expenses. Your attorney, alongside a trusted financial planner and a tax advisor, will guide and advise you through all the nuttiness-gritties. Your divorce team will help you prepare your financial statement, as well as help you understand the myriad of different ways your divorce can affect you now and in the future. They are there to make sure the best possible outcome for both you and your spouse.
Every divorce is different. Laws change, judges change, attorneys change. There is no such thing as a standard divorce. Your marriage and financial situations are unique to you. You need to make sure that you are working with someone who understands what you want, what you need, and how to get there. Friends may recommend lawyers but you should never rely solely on a friend’s recommendation. When hiring an attorney, choose one who is willing to work hard for you and treat you fairly. Don’t hire a cheap low priced attorney who won’t fight for you. Choose a lawyer that will stick up for you and protect your rights. You may want to consider having a lawyer who doesn’t do no-holds-barred business. This means he/she will not take advantage of you. You need an attorney who will fight hard for you.
Divorce is never easy, but you must be careful not to make hasty decisions. You could end up losing money and property by settling too soon.
Divorce is a difficult time for everyone involved. Stashing away assets is unethical and illegal. Doing so could lead to legal action by your ex-spouse. This could also cause you to be viewed as dishonest.
Divorce is expensive. No matter how much money you may have, the same rules apply. You must identify and evaluate all assets owned individually and by family together. Find out the status of all your assets and obligations. Determine what third-party responsibilities you share. Divide your assets as equally as possible, but avoid taking anything away from your partner. This is a simplified summary and does not address non-property issues like child custody, but these are basic steps for conducting a divorce. For many, this simply simplifies divorce, at least in theory. When you're only trying to divide a couple of bank accounts, a retirement account, and a house, then it's fairly easy to add up the numbers and divide them in half. But in those cases, if not most, the complication becomes emotional - because divorce by definition involves parties with strongly felt emotions, and often one or both will attempt to use the entire process to punish their soon-to-be ex. High net worth divorces tend to be particularly complicated. Divorce lawyers often deal with these types of cases.
When you split up, you're not just dividing up assets as we know them today. You're making plans for the future. You need to make sure that you properly anticipate tax consequences. You need to look at the potential long-run value of your assets, instead of just their current valuation. You want someone who helps you think about the long run, not just the next month or two.
High-asset divorces present unique challenges. Individuals must approach them carefully to avoid potential problems. There are clear do’ and don’t’s when dealing with high asset divorces. Follow them to avoid potential issues and reduce stress during your separation.