Unique Issues in High Net Worth Divorces
No couple is entirely immune from divorce, despite perceived advantages of a stable home, economic success, or many years together. These factors can certainly help to sustain a relationship, but dissension can hit even the happiest of couples. Financial stress is known to kill relationships, and out of this fact, the general belief is spouses with high net worth are assumed to have no problems which might endanger the strength and health of the relationship. However, a study by the Federal Reserve Board claimed that having a large income did not always equal a successful marriage, with the more accurate parameter for success being similar fiscal outlooks and high credit scores. Additionally, the study found that during times of economic growth, couples are more likely to divorce sooner, compared with downturns that saw more spouses choosing to make more attempts at reconciliation. Thus, as the saying goes, money does not buy happiness, and couples with high net worth face the same challenges as everyone else to make a marriage last. If divorce does happen, though, these couples do face somewhat unique issues that color how a divorce should be approached, and the issues they will need to be addressed. A discussion of some factors particularly relevant to high net worth spouses considering divorce will be explored below.
The dynamics of every relationship is different, but there are few common factors among those with high net worths that can set them apart from many other couples. First, it is more common for one spouse to have little or no knowledge of the couple’s finances, particularly if financial resources were brought into the marriage or primarily generated by one party. Further, one spouse is more likely to not work, creating significant economic disparity. Finally, high net worth spouses tend to have much more complicated asset portfolios that can be more difficult to value and divide in divorce.
The largest issue in high net worth divorces is arriving at an accurate and fair division of marital property, and much of this hinges on collecting an accurate inventory of all property and receiving reasonable valuations from appraisers. These numbers determine how much alimony must be paid, and by whom, the amount of child support, and if attorney’s fees should be picked up by the other spouse. Forensic accountants may also be necessary, especially if there is concern not all assets are identified, a danger when one spouse is in the dark about the household finances.
Alimony is also a more common demand in high net worth divorces, particularly if one spouse is not working. The spouse seeking alimony may have an uphill fight if the other spouse does not agree to this support, as Florida law grants courts broad discretion in setting these awards. Further, asking for alimony could give the other spouse more reason to hide assets or income, so finding the right team of legal and financial experts to investigate and verify these numbers is crucial.
Settling Out of Court
The factors outlined above might appear to suggest that conflict is inevitable in these cases, but such is not a foregone conclusion. In fact, an out-of-court settlement is typically better for everyone involved, as it preserves the privacy high net worth individuals tend to want and avoids spending large amounts on litigation that will erode the financial stability of the family. More importantly, it allows the spouses to structure an arrangement that represents their goals and desires, rather than what a court might fashion as appropriate.
Seek Legal Advice
Divorce presents challenges for all couples, but high net worth spouses have particular complications that require the services of an experienced divorce attorney to fully address. The Orlando attorneys at the Donna Hung Law Group can offer high net worth spouses a variety of options to obtain a divorce that will protect privacy, but also allow for full investigation of all outstanding issues. Contact us at (407) 999-0099 for a consultation.