There are many advantages in life to having a high net worth. Unfortunately, quick and easy divorces are often not one of them. Divorce between couples who are worth a significant amount of money takes skillful planning and negotiation. If you are concerned that your net worth may be affected by your divorce, read on to learn more about how you can protect yourself.
Individuals who have family or pre-established business wealth often require their future spouse to sign a prenuptial agreement. When these agreements are in place, the divorce process will usually proceed much more smoothly.
Couples who have a prenuptial agreement may have agreed to give up the right to seek alimony, or may have agreed to a pre-determined amount of money as a reasonable allowance for a certain period of time. These agreements may also cover whether or not the spouse has any right to certain items of property, or real estate, or business ventures.
In most cases, what was decided in a prenuptial agreement will stand, so long as the contract applies with Washington law and is not unconscionable. However, couples with children may still have to decide issues like child custody, child support, and visitation rights.
Finding and Cataloguing Assets
If there is no prenuptial agreement, the most important first step in a high-net worth divorce case is to find and catalogue all of the couple’s assets. Because Washington is a community property state, any personal or business ventures owned by the couple become marital property.
Often, accountants and financial investigators are used to go over a couple’s personal and business finances. These professionals will analyze a couple’s net worth, and will include assets like stock portfolios, investment accounts, domestic and offshore accounts, and business profits and losses when calculating a couple’s total assets. They will also look for evidence of money or property that a spouse may have been trying to hide from their former partner.
In many cases, financial professionals will need to work closely with each spouse’s divorce attorneys in order to create an equitable division of property. It may take several weeks for a divorce team to accurately value a business, research real estate transactions, analyze stock options and investments, and organize retirement or 401k accounts. Once an accurate picture of the couple’s financial state is drawn, the attorneys can begin negotiating on their client’s behalf.
In addition to managing and dividing a couple’s finances, spouses with children will also have to create a child support and child custody arrangement. When a high-asset divorce, it is especially important for spouses to be honest with each other about their work and travel schedules. If one parent is required to work 70 or 80 hours a week, or is overseas on business every month, it would not be fair to the children to give sole custody to that parent. Plus, it could lead to costly returns to court later when those absences are discovered.
In addition to custody concerns, a judge will expect parents to work together to keep their children’s lives as stable as possible. This will include the child’s standard of living, schooling, and housing arrangements. Often, high-income parents will need to pay more in child support or spousal support in order to make this possible.
Successfully completing a high-asset divorce case requires skilled assistance and teamwork. At Pacific Northwest Family Law, our attorneys are experienced in handling divorce cases between high-income individuals, and will work with your team of financial and business advisors to create a plan that works for you. Discover what we can do for you by calling 509-572-3700.