A complex divorce requires certain actions that are not always applicable in every divorce.
Divorce can be challenging no matter the income bracket or assets of those involved. A high-asset divorce, however, may require certain considerations and actions that do not apply in all divorce cases. Professional degrees, professional practices, business ownership, retirement assets and real estate can require more negotiation and a greater complexity in a division of assets than may be needed otherwise.
A couple need not be on “The Forbes 400” richest people in America list for complex divorce considerations to be relevant. Couples who have worked hard, saved money and invested may find themselves with numerous assets to consider in a divorce. Before beginning a complex divorce, a couple may wonder whether they can afford to divorce, what is involved in the divorce process and how their living situation may change because of the divorce. Below are just a few things couples considering a high-asset divorce can expect.
Expect the need for extensive documentation
In a high-asset divorce, perhaps the first and most important financial aspect is establishing a thorough and accurate picture of all assets and debts. This means valuing property, running a credit check, obtaining tax returns and if appropriate investigating potential hidden assets. The process may take more time, but it is essential to prevent one ex-spouse from giving up potential assets in a divorce.
Expect to have to look for assets
Financial arguments are a leading predictor of divorce. And hiding assets is relatively common; according to one survey by CreditCards.com, almost 10 percent of spouses have a hidden bank or credit card account. In a contentious divorce, it also may be tempting for one spouse to attempt to hoard hidden assets to create an unequal division of assets.
In order to ensure each party to the divorce is getting what he or she deserves, financial advisors, accountants and private investigators may be needed to make certain the finances of each party are transparent.
Expect the need for professional valuations
In some cases the issue revolves around the value of the property or asset, not in its discovery. How much is a professional degree worth? What about a business with limited liquid assets? Properly valuing an asset is vital in ensuring each party understands what is at stake in the divorce.
Expect to have to negotiate to maintain the same standard of living
One question many couples considering divorce have is whether they can afford to divorce. Many valuable assets are relatively non-divisible, for example. A business or real estate property may be worth a significant amount but create difficulties when it comes down to cash and daily living expenses.
Creative solutions may be needed, such as acquiring an asset with future earning potential in exchange for a lump sum alimony. A spouse who worked in the home while the other obtained a professional degree may obtain alimony in exchange. While each solution may require a unique approach, a complex divorce does not have to keep a couple in an unhappy marriage.
A complex divorce requires unique solutions
There is no cookie-cutter approach when dealing with a complex divorce. Individual circumstances and the goals of each person in the divorce mean that the best outcome must be tailored to individual needs and wants.
People considering divorce who are concerned about a division of assets should speak to an experienced family law attorney to discuss their legal options and next steps moving forward.
Keywords: divorce, high-asset divorce, complex divorce, property division, small business.