Have you ever heard the phrase, “more money, more problems?” It’s an acknowledgment that the more you have to lose, the harder it can be to protect what’s rightfully yours.
This is particularly true when you’re going through a high asset divorce. The more that a couple has to divide, the harder it can be to reach amicable terms. Absent prenuptial (or postnuptial) agreements, high asset divorces often end up in litigation. With that in mind, you want to avoid damaging your position later in court with these mistakes:
Trying to hide marital assets
You and your spouse both have to disclose all your assets so that the marital property can be separated from private property and subsequently divided. It’s not uncommon for affluent spouses to sometimes try to hide something that they feel their partners have no claim over, but that is a big mistake. Most likely, your spouse will have at least one forensic accountant looking for anything hidden – and the court will generally penalize you heavily if you’re caught.
Wasting marital assets
It’s frustrating to think that your spouse could be given half of your car collection – or half its value after the collection is sold. You wouldn’t be the first spouse to consider selling everything for a dollar just to hand your spouse 50 cents in retaliation – but don’t do it. That’s called the dissipation of marital assets and the court can take other assets away from you in response to compensate your spouse for the loss.
Forgetting about the tax implications
If there’s a lot of property and other investments involved, you need to have sound financial guidance during this time to understand the tax implications of your decisions. For example, you can have two assets that seem like they’re worth the same amount. However, if one is subject to capital gains taxes after your divorce and one isn’t, then they’re far from alike.
Ultimately, it’s simply wisest to remember that high value divorces have different areas of concern than the typical divorce – and you need to take steps to protect your future.
