Typically, a high-asset divorce is one in which there is at minimum $1,000,000 in liquid assets subject to division. High-asset divorces can be complicated depending on the couple. Still, this type of divorce has unique challenges regardless of who the parties are, but it does not have to be impossible.
Avoiding certain mistakes or traps in a high-asset divorce can make the process easier for the couple and their families. Below are examples of common mistakes that high-asset couples have made during the process of divorce, so you can avoid making the same mistakes.
Thinking that not having a prenuptial agreement will end in disaster
In many marriages with significant wealth, a prenuptial agreement (prenup) is probably already in place in the event of divorce. In some cases, however, there is no prenup, leading one or both parties to panic and wondering if the lack of a prenuptial agreement will leave them with nothing.
The good news is that this does not have to happen if you choose the proper divorce process and strategy. For example, two of the wealthiest couples in the world did not have prenuptial agreements, hired attorneys, and settled their divorces via mediation.
These couples did not want to litigate their matters publicly because they were well-known. They knew that it was better to negotiate the terms of their divorce privately, with their chosen attorneys and with the help of a skilled divorce mediator.
Hiring the wrong lawyer or law firm
Due to the complexity of a high-asset divorce, both parties should think carefully before hiring an attorney to represent them. There are all kinds of attorneys, some who specialize in high-asset divorces, others who handle many different areas of law but do not specialize in divorce law.
There are some attorneys who approach divorces aggressively and others who look at the big picture and try to make the process one in which the parties do not try to destroy each other by trying to get the most out of the divorce at the other party’s expense.
It is wise to consider hiring a lawyer who understands this subject matter and has often taken on similar cases. It is also essential to consider the lawyer’s personality and whether the lawyers from both sides work well together and negotiate in good faith.
This ideal situation will make the divorce process more manageable, whether you go through mediation or the court system.
Hiding assets or debts
In every divorce, the parties must exchange all their financial information in good faith, no matter how much is at stake. In the court system, this is the discovery process and telling the truth is not optional.
In many high-asset divorces, if a spouse suspects the other is hiding assets or financial information, they can hire a forensic accountant to investigate the individual’s finances.
These professionals are pretty good at exposing the accurate financial picture of any individual, and if one party has lied, they could find themselves in significant trouble with the court.
Being unprepared for post-divorce life
Life after the divorce is final will be different. No matter what agreement the parties reach, it is very likely that they will have to adjust their lifestyles because they no longer count on what they used to have.
People often forget to consider that post-divorce life is where the changes happen. Change is hard, and this type of change is one of the most challenging life changes anyone can experience.
Consider having a solid support system, seeking psychological support if necessary and talking with your doctor if you have lingering strong feelings that affect your day-to-day life.
Divorce is difficult for everyone but exactly how hard the process is depending on several factors, including the attitude of the parties, their strategy for divorcing and the choices they make throughout the process. Trying to avoid critical mistakes can make the divorce process easier and perhaps even more profitable for both parties.