If you and your spouse have decided to end your marriage, property division is probably the part of the divorce process you dread most.
Property division for high-net-worth couples can be complicated and time-consuming. Exercise patience and avoid these four common mistakes.
1. Acting in haste
Perhaps your spouse has fallen for someone new. Perhaps you have. In either case, you are anxious to get the divorce over with. In an effort to make the process go more quickly, you are willing to give up assets you should keep and keep liabilities your spouse should handle. If you initiated the divorce, you may also feel guilty, which is another reason for giving up too much and rushing things.
If you allow your spouse to have the rare art collection and the luxury autos, you risk an imbalance that will affect your financial welfare going forward. Giving up a vintage Rolls Royce Phantom means you should receive something of equal value in return.
2. Thinking an investigation is unnecessary
Are you sure all the marital assets will be out on the table during property division? In many high-net-worth marriages, one spouse is often more sophisticated in the financial sense, and it is not uncommon for that party to attempt hiding certain assets. Do not shy away from hiring a forensic accountant or business appraiser to help ferret out assets you may not know anything about.
3. Failing to account for taxes
Keep in mind that you will have to pay taxes on certain assets that you receive in the settlement. Tax consequences in a high-net-worth divorce can be significant.
4. Listening to the advice of friends
While it may sound a bit trivial, you should resist listening to the advice of your friends and relatives who have gone through their own marriage breakups. Remember that all divorces are unique. You can rely on the advice of professionals who will guide you through the divorce process and help you avoid costly mistakes.