June 26, 2024

Divorce is always challenging, both logistically and emotionally, but when the divorce involves a couple with significant assets, things can quickly become even more complex. Dividing a portfolio that can include substantial assets, such as businesses, real estate, and investments can make the process intricate and overwhelming. Having the right attorney to work with you to protect you and your future is essential when going through a high net worth divorce. An attorney who is experienced in high net worth divorces will understand all the nuances and complexities and will have the right network of financial professionals to make sure the divorce settlement is not only fair, but has as little contention as possible.

What Defines a High Net Worth Divorce?

A high net worth divorce is one where the divorcing couple has significant assets to divide, with the value of the combined assets at a million dollars or more. The assets are not simply the dollar amount in various accounts, but the value of other assets including real estate, businesses, and investments. While one million dollars in assets is the baseline, many couples facing a high net worth divorce have assets that are many times more than that. These splits are generally considered to be more complicated than a standard divorce, not only due to the value of the assets, but the variety of assets that will need to be divided. In some cases, one spouse may have entered into the marriage with substantial individual assets, and this can further complicate the divorce process. Even if the assets coming into the marriage are uneven, the combined net worth of the couple will define the split as a high net worth divorce, and the attorney you choose to represent you should have an in-depth understanding of the financial and legal intricacies in the process.

What are Some of the Unique Challenges of High Net Worth Divorces?

High net worth divorces can have very unique challenges when compared with standard asset splits. Some of these challenges include:

• Complex Asset Portfolios and Intricate Financial Arrangements

Most high net worth divorces have very complex portfolios, with the overall value spread across many different assets and accounts. In a high net worth divorce, it is essential to make sure that both spouses are presenting a full and accurate distribution of their assets with no omissions.

• Spousal and Child Support

Determining the right value for both spousal and child support in high net worth divorces can be challenging, as it will involve a thorough evaluation of the current lifestyle and standard of living as well as the needs of both spouses. An experienced attorney can help determine a fair and equitable support agreement.

• Prenuptial and Postnuptial Agreements

While some couples go into a high net worth marriage with a prenuptial agreement in place to protect both spouses, this is not always the case, especially when assets were obtained after the marriage. Any attorney working with a high net worth divorce should make sure that all agreements are valid, and that they are applied correctly, as they can greatly influence how assets are divided.

• Business Ownership

When one or both spouses own a business, the value of the business needs to be considered in the divorce. In nearly all cases, a professional will be brought in to do the business valuation. However, when the business is owned jointly, there are several possibilities for how to split the assets in a way that protects the business.

• Real Estate Holdings

Current market value will need to be considered when dividing real estate. There are several options for dividing real estate holdings that are considered equitable, but both spouses and their attorneys will need to understand the value of each piece of property as well as any tax implications.

• Tax Implications

Whenever assets are transferred or liquidated, there are tax consequences that need to be considered. Your attorney should understand all the tax implications associated with the settlement to make sure you are well protected in the future.

• Inherited Wealth

If one spouse has inherited wealth, this is usually protected during divorce, but it does require some advance planning, and more importantly, an experienced attorney.

With all of these financial and legal challenges, couples going through a high net worth divorce are also facing emotional highs and lows. Having an attorney who understands the intricacies of the process is key.

Choose Your Attorney Carefully for a High Net Worth Divorce

Without an attorney with the right skills and experience, you may risk your financial future through divorce. The attorney you choose should have experience with high net worth clients, a positive track record in divorces similar to yours, an assurance of confidentiality during the process, and an instinct to protect you and your future. While it may be tempting to hire a “bulldog” who will fight dirty to get you a settlement in your favor, finding an attorney that will strive for an equitable, fair, and amicable settlement is a much smarter choice. While your emotions may be running high, an attorney that only wants to fight may be the only one who benefits from a long, contentious split.

An attorney who can look at your full portfolio and help determine a fair split will leave you in a much better place to move forward. In addition to looking at the attorney themselves, make sure to ask about the other specialists your attorney will work with during the process. Many attorneys who take on high net worth divorces have professional relationships with forensic accountants, tax professionals, and business valuation specialists that can help you.

The stakes may be high in a high net worth divorce, but you can still get through the process with a minimal amount of stress when you are working with the right attorney. If your attorney has the right experience and skills to get you through the process, you can move forward with confidence. If you’re filing for a divorce, or going through a divorce and looking for an experienced attorney to help you get through this, contact my office right away.