5 High-Asset Divorce Mistakes You Can’t Afford to Make

May 12, 2019May 10, 2019
by Angie

High-asset divorces can be incredibly contentious – and unfortunately, when there’s a lot of back-and-forth, people make mistakes. But making a mistake in a high-asset divorce can cost you for the rest of your life, so it’s important that you’re aware of the potential pitfalls and that you know how to steer clear to protect your assets.

Check out these five high-asset divorce mistakes so you know how to protect yourself – and your future.

5 High-Asset Divorce Mistakes: What NOT to Do

The most common high-asset divorce mistakes we see in our offices include things like:

Letting emotions rule over logic
Making rush decisions just to get the divorce over with
Hiding assets from one spouse
Failing to consider tax consequences
Going straight to litigation rather than negotiation

Here’s what you need to know about each of these high-asset divorce mistakes.

High-Asset Divorce Mistake #1: Letting Emotions Rule Over Logic

Divorce is an emotional process, whether it’s due to infidelity or anything else – and that can make it tough to make logical decisions. However, now is the most important time to focus on what’s most important: your future.

It’s not uncommon for one party in a divorce to feel guilty about what’s happening, but it’s a big mistake to let that guilt guide the decision-making process. For example, if you feel bad and agree to give your spouse double the spousal support he or she would ordinarily receive, or you decide to hand over more than half your marital assets, you’re cutting into your own future.

On the other side of the coin, you can’t use the court system to exact revenge on your spouse. Divorce is a legal process, and if you try to use the legal system to get back at your ex for what he or she has done, it’s more than likely going to backfire on you.

High-Asset Divorce Mistake #2: Making Rush Decisions

In many cases, both parties just want the divorce to end – and they’re willing to make less-than-informed decisions in an effort to wrap things up quickly. There are several reasons people want to rush through divorce, such as hoping the divorce will attract less media attention or simply wanting to be done with a spouse they can’t stand any longer.

Unfortunately, though, you can’t rush through a divorce and cover all your bases. You need to take the time to avoid making serious mistakes that will cost you long after your divorce is final.

High-Asset Divorce Mistake #3: Hiding Assets

In some cases, one spouse hides assets from the court so he or she doesn’t have to split them. California is a community property state, which means the assets you accumulate during your marriage – in most cases, anyway – belong to both spouses.

Hiding assets can get you into serious hot water with the courts – and in addition to the court finding out about those assets and dividing them anyway, you’ll lose your credibility. The majority of hidden assets are eventually discovered during the divorce process.

High-Asset Divorce Mistake #4: Failing to Consider Tax Consequences

Divorce changes your financial situation – sometimes drastically. Most of the financial transactions that take place during divorce have tax consequences, including the division of retirement accounts and the sale of homes, vehicles and other property.

Your attorney may suggest that you hire a tax professional or another financial expert to help you understand the tax consequences of the financial decisions you make now.

High-Asset Divorce Mistake #5: Going Straight to Litigation

For most people – even in high-asset divorces – negotiation is the way to go. You may not mind spending money on attorney’s fees through litigation, particularly if it means you’re going to “win,” but the vast majority of people who negotiate their own settlements end up being far more satisfied with the outcome than those who litigated in court.

When you and your spouse reach agreements on the major issues surrounding your divorce, including child custody and property division, your divorce will go faster and be less stressful for everyone involved. If you and your spouse can’t reach agreements on your own, your attorney might suggest that you work with a mediator who can help.

Related: What is divorce mediation?

Need to Avoid These Costly High-Asset Divorce Mistakes?

We welcome the opportunity to answer your questions about mediation and divorce-related issues such as custody, child support, spousal support, and the divorce process.

Call us at 209-546-6870 for a divorce case evaluation. You’ll talk to an experienced Stockton divorce lawyer who can give you the advice you need to begin moving forward.

Divorce

3 Common Mistakes in High-Asset Divorce

October 17, 2017May 31, 2019
by Angie

High-asset divorce can be incredibly contentious – but there are things you and your Stockton divorce attorney can do to make the process simpler so it can end sooner (and on more favorable terms for everyone).

First, though, you need to ensure you’re working with a divorce lawyer you can trust; one who always has your best interests in mind as she negotiates, strategizes, and defends your rights in court. Many people start off on the wrong foot by working with an attorney who doesn’t understand the nuances of high-net worth divorces.

Although California law is very clear on matters such as child custody, child support, and spousal support, high-asset divorces can be more complex than others – and that’s largely due to the size and value of the marital state involved.

Common Mistakes in High-Asset Divorce

Many of the most common mistakes people make during high-net worth divorces revolve around unfamiliarity with the process (and that’s another reason to work with an experienced attorney). Some of the most common high-asset divorce mistakes we see include:

Not properly valuing businesses and other interests
Hiding assets or failing to investigate the other property
Agreeing to anything just to get it over with

High-Asset Divorce Mistake #1: Not Properly Valuing Businesses and Other Interests

If a couple is running a business, each side needs to have its interests valuated. Owning non-family partnerships, shared retirement assets, trusts, and real estate holdings can further complicate the process. Private and public firms need to be valuated, as do IRAs, pensions, stock options, and other financial holdings.

This always requires an expert’s help. Whether the valuation expert you hire uses the comparable company analysis or an estimated discounted cash flow method, it’s important that you only work with a qualified professional.

High-Asset Divorce Mistake #2: Hiding Assets or Failing to Investigate the Other Party

Hiding assets is illegal, and your attorney will advise you to come clean about all the property and holdings subject to your divorce case. If you fail to provide adequate information, or if the court finds out you’re purposefully hiding assets, you’re going to lose credibility with the court. That’s true if you transfer assets to a third party, you neglect to share information, or you’re outright fraudulent in concealing assets.

The other party may be hiding assets, as well, which means your attorney and the financial experts you’re working with will need to investigate him or her to make sure everything is on the table.

High-Asset Divorce Mistake #3: Agreeing to Anything Just to Get it Over With

Most people want their divorces to end as quickly as possible, and if you feel that way, you’re definitely not alone. However, it’s nearly always a mistake to agree to everything your soon-to-be ex-spouse demands just so you can get things over with faster.

In fact, you shouldn’t agree to anything until a complete valuation has taken place and you’ve talked to a financial adviser. Even if you feel guilty over the divorce, or you’re in a rush to split because you’ve found someone else, don’t make any agreements without discussing them with your attorney first.

Do You Need to Talk to an Attorney About High-Asset Divorce?

If you’re involved in – or you’re about to become involved in – a high-asset divorce, call us at 209-910-9865 or get in touch with us online to schedule your appointment with a Stockton divorce lawyer who can help today.

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