When is it Considered a “High Net Worth Divorce”?
A divorce is considered a high net worth divorce when the divorcing parties have a large sum of money or assets to divide. This type of divorce is more complicated than other divorce since there are more financial factors to consider. If you need a high net worth divorce, here are some things you should know from a Sarasota divorce attorney at the Law Offices of Matthew Z. Martell.
What is a High Net Worth Divorce?
A high net worth divorce involves a divorcing couple with a high net worth – typically defined as having assets of $3.5M or more. High net worth divorces often involve complex financial issues, such as the division of businesses, investments, property, retirement accounts and/or deferred compensation. They normally also deal with alimony and attorney’s fees and costs reimbursement what is typically the non-working spouse. They may also deal with child custody, timesharing, and child support. Because of the complexity of these divorce cases, it is essential to have an experienced high-net-worth divorce attorney on your side like Sarasota, Bradenton, Lakewood Ranch, and Venice, FL divorce lawyer Matthew Z. Martell.
How Marital and Non-Marital Assets Are Calculated
In a divorce, all assets and debts must be divided between the spouses. The process of dividing assets is called equitable distribution. Marital assets are all the assets that were acquired during the marriage starting from the date of marriage until the date of filing the divorce. Non-marital assets are all the assets that were acquired before the marriage or after the date of separation. This distinction can significantly impact how assets are divided and, as such, is usually contested.
Do’s and Don’ts: Preparing for a High Net Worth Divorce
As stated above, a high net worth divorce is one in which the spouses have a significant amount of assets to divide between them. This normally includes real property, brokerage account investments, businesses, and retirement accounts. Because there is so much at stake, it is essential to avoid these common high net worth divorce mistakes:
Do: Keep Your Cool
Divorce is one of the most emotionally tumultuous experiences anyone can go through. It’s important not to let emotions guide your decisions. During a divorce, the divorcing spouses tend to focus on “winning,” which leads to choices made from spite and bitterness rather than logic, reason, and sense of what’s best for their financial and emotional future post-divorce. It’s far better to consider what issues can be compromised, settled, and also try to work toward a mutually beneficial outcome.
Don’t: Hide or Fail To Disclose Assets
Hiding assets during a divorce is a bad idea because it is illegal, it is extremely hard to do if forensic accountants become involved in your divorce (which normally they are in high-net worth divorces), and it can result in very negative outcomes in your case. If discovered after the divorce has been finalized, hidden assets also can be used to offset any financial settlement stemming from a Marital Settlement Agreement from your divorce. More importantly, you could face contempt of court, sanctions, fines, and possibly even criminal penalties. Additionally, your credibility and your word will be tarnished in the eyes of the Court, which will assuredly result in rulings and/or judgments against you.
Do: Consider The Long Term
Before trying to obtain certain assets high-value assets such as retirement accounts, you must consider the taxes such assets will incur over time. This will help you determine whether it makes sense to ask to be awarded these assets in the divorce and/or how much of that particular asset you should request. We call this “tax-impacting the retirement accounts” and normally it is calculated by your expert witness forensic accountant in a high net worth divorce. It would also help if you also considered your overall investment goals. For example, if you are young and saving for retirement, it would help if you concentrated on getting a diversified portfolio that will give you the best chance of achieving your long-term retirement goals.
Don’t: Try To Handle It Alone.
High net worth divorces are typically a complicated process. You’ll want an experienced high net worth divorce attorney to help guide you to a favorable outcome. There are many benefits to hiring a high net worth divorce attorney. One of the most important benefits is that such an attorney can help you navigate the legal system and ensure that your legal rights are protected. A high net worth divorce attorney can also help you understand the complex financial and emotional issues involved in such a divorce, as well as provide guidance and support throughout the process.
The Law Offices of Matthew Z. Martell has the divorce lawyer Sarasota residents need to achieve their overall legal goals. Contact us today at (941) 556-7020 and schedule your Phone Consultation to learn more about how we can assist you with your Sarasota, Bradenton, Lakewood Ranch, or Venice, Florida high asset divorce.