Divorce is never easy, regardless of your circumstances. However, couples engaged in high-asset divorces may find themselves facing a variety of unique challenges, thanks to an increased number of complicating factors in the divorce process for high-net-worth individuals.
Understanding common mistakes made in high-asset divorces, and how you can face those hurdles head-on, can help you navigate the high-asset divorce process with confidence.
Mistake #1: Failing to Account for Taxes
Taxes often play a huge role in high-asset divorces. For example, let's say you fight to retain the marital home. Will you have to pay an estate tax? If you choose to sell the home, will you be on the hook for a capital gains tax?
You should work with a financial professional, like your accountant, to understand how retaining or selling certain assets will affect your taxes when tax season rolls around. Playing some financial Tetris may get you the best results.
Mistake #2: Underestimating Alimony and Child Support Judgments
The court has one goal in a divorce: Set up all parties involved (spouses and children) so they can retain the same quality of life post-divorce that they enjoyed during the marriage.
For many high-net-worth individuals, this means unexpected child and spousal support costs—especially if only one party was the breadwinner. People often expect costs for items like food and clothing, but overlook other expenses—like continuing to provide tutoring and extracurricular activities for children—that often get wrapped into child and spousal support arrangements during high-asset divorces.
Work with your lawyers to learn more about what you should expect from your divorce in terms of child and spousal support judgments, and budget accordingly.
Mistake #3: Failing to Explore Forms of Alternative Dispute Resolution (ADR)
Alternative dispute resolution (ADR) methods like mediation, collaborative divorce, etc. can be incredibly useful during high-asset divorces.
Firstly, choosing a more collaborative, negotiation-focused divorce alternative reduces tension during the divorce, helping both parties get what they want from the process without sacrificing too much.
Secondly, choosing a form of ADR for your divorce can help you keep the divorce out of the public record, which can be vital if you fear that the media will take an interest in the divorce to "air your dirty laundry," so to speak.
Forms of ADR can lay the best foundation for your life and your relationship with your ex moving past the divorce, so don't write them off.
At Beatriz Zyne, P.A., we help FL natives handle all the nuances of high-asset divorce.
To schedule a consultation with our team, contact us online or via phone at (305) 876-6138.