High Net Worth Divorce: Common Concerns and Expert Advice

What Clients Often Ask in the Early Stages of Divorce

Common Questions about Financial Security, Entitlements, and Division of Assets

Clients facing divorce frequently have three pressing questions: Will I be financially secure? What am I entitled to? What will I have to give up? Naturally, they want to understand the divorce process and its potential impact on their future. As a seasoned high net worth divorce attorney, it is my priority to alleviate their uncertainties by providing a clear roadmap. To begin addressing these questions, we ask clients to bring in relevant documents for the initial consultation. This allows us to gain a comprehensive understanding of their current financial situation.

The Rise of Mediation for High-Asset Divorces

Privacy and Efficiency as Key Factors

More and more high net worth individuals (HNWIs) are opting for mediation instead of trial, and for several good reasons. As a family law mediator for over two decades, I have witnessed a significant shift in divorce proceedings. In recent years, mediation has emerged as the preferred method, especially for high-asset divorces where privacy is paramount. Many individuals are unaware that once a divorce case is filed in court, it becomes a matter of public record. This means anyone can access personal details by simply visiting the courthouse.

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Aside from privacy, parties involved in divorce cases turn to mediation because it yields settlements in 85-95% of instances and is considerably faster than the court system. Mediation’s efficiency inherently reduces costs. However, it is crucial to understand that although mediation is expedient and cost-effective, it is by no means a casual process. It requires careful planning, organization, and skillful negotiation to achieve the desired outcomes.

The Timeframe for High-Asset Divorces

Complexities and Expert Involvement

In Washington state, divorce can be finalized within a minimum of 90 days. However, high-asset divorces typically take around a year to complete due to the intricate nature of the proceedings. Valuing substantial and complex assets owned by HNWIs often necessitates the expertise of appraisers, valuators, and forensic accountants. Beyond real estate and business ventures, seemingly inconspicuous assets also require expert valuation. From extensive Barbie doll collections and rare guitars to offshore bank accounts, every asset acquired during the marriage must be assigned a monetary value. This meticulous process takes time.

Lifestyle Changes in High-Net-Worth Divorces

Financial Adjustments and Impact on Net Worth

Clients often experience significant financial adjustments as they face the reality of dividing assets fairly and equitably (not necessarily in a 50/50 split). Both net worth and income streams are inevitably affected.

Determining Maintenance Payment

Factors Considered by the Court

In determining appropriate maintenance payments, the court takes various factors into account. These factors include the length of the marriage, each partner’s financial situation, health, educational background, and separate property accumulated during the marriage.

Impact of High-Asset Divorce on Businesses and Partners

Challenges of Dividing Business Interests

For clients who have equity in businesses, dividing shared interests during divorce can be highly challenging. This is particularly true when there are no other assets to fall back on. In such cases, we collaborate with skilled forensic accountants and appraisers to develop feasible payment schemes that enable the business to thrive during and after the divorce. Our goal is to negotiate a fair financial arrangement that ensures both parties receive a just share of the community estate.

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It is advisable to keep partners informed about impending divorce proceedings. It is better for them to hear the news directly rather than being surprised with subpoenas or unexpected deposition requests. A proactive attorney will likely arrange a meeting with you and your partner(s) to ensure everyone understands what to expect and what may be required.

What Can Be Subpoenaed?

The Broad Scope of Discovery

Almost anything can be requested and obtained through subpoenas, with the exception of attorney/client privileged documents. Although relevance and admissibility in court are determined later, the discovery process allows attorneys to gather significant information.

Communicating with Your Ex during the Divorce Process

Civil Communication and Written Correspondence

I encourage clients to maintain communication with their spouse as long as it remains civil. However, if civil communication becomes impossible, it is advisable to switch to written correspondence. It is crucial to keep copies of all emails and texts, as they may prove useful to your attorney.

Avoiding Mistakes in High-Stakes Divorce

The Importance of Experienced Representation and Proper Business Practices

To protect your wealth, it is crucial to have skilled representation and a team of capable experts from the outset of divorce proceedings. Starting with an inexperienced team often leads to complications.

I also advise clients to maintain a clear distinction between personal and business affairs. Blurring these lines only adds confusion and ambiguity, which can prolong the divorce process. It is surprising how little some spouses know about their financial situation, including the percentage of business ownership or outstanding mortgage amounts. Therefore, it is essential for spouses who have not been actively involved in financial decision-making to educate themselves and keep track of their assets, locations, and accessibility.

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Lastly, if you have a new partner, I recommend keeping the relationship low-key. Flaunting a new significant other tends to complicate matters emotionally and can protract negotiations.

Choosing the Right Representation

The Significance of Experience and Professional Recognition

When selecting legal representation, experience is paramount. Look for an attorney with substantial experience and a proven track record. Additionally, consider whether they have received recognition from prestigious organizations such as the American Academy of Matrimonial Lawyers (AAML), Best Lawyers, and Super Lawyers. These accolades are awarded based on peer reviews and professional achievements. Seasoned attorneys also possess valuable networks of experts, including forensic accountants, appraisers, and other lawyers who may participate in mediation sessions.

Educating yourself about the divorce process, managing your personal and business relationships, and taking proactive steps to prevent unnecessary delays can make a significant difference in reaching a fair resolution. However, nothing compares to the value of selecting a strong and experienced attorney to represent you in a high-net-worth divorce. From the initial consultation where you asked, “Am I going to be ok?” to the negotiation and resolution stages, the decisions made during your divorce will have long-lasting implications. With so much at stake, compromising on your legal representation is simply not an option. A highly-experienced family law attorney is your best ally in protecting your hard-earned assets and ensuring a fair resolution. Breathe easier knowing you have a formidable team who will guide you through the process and assure you that, yes, you are going to be ok.

Have Questions?

Here at Garrity Traina, we are dedicated and tenacious in providing unwavering support to our clients throughout their cases. With a focus on experience and ethical representation, we strive to make the legal process approachable. If you have any questions or would like to schedule a consultation, please fill out the form below.

Related Links: Family Law / Divorce | Divorce Guides