High Net Worth Collaborative Divorce
While there are many reasons to seek a divorce, sometimes negative, sometimes positive, in many cases, the outcome is the same: it is expensive. Attorneys bill for the time they spend on your case — court hearings during the pendency of the divorce, weeks of trial preparation, working with each witness regarding court testimony and the cost of the trial time itself.
BUT many people do not want the war, the hostility, and the expense. Sometimes two people want to separate amicably and move on with their life. While this is possible, it is more the exception than the rule for couples who possess a high net worth.
Generally, couples that have amassed a high net worth own many assets and often have a substantial number of revenue streams. During a divorce, these couples also have access to attorneys that will do everything they can for their client and get them the largest prominent settlement. Sorting through numerous assets, obtaining valuations, and the tax consequences associated with them, reviewing the various types of income and how they differ, all take time, a great deal of time. And in litigated cases, all of this can be contested.
But there is an alternative, using the collaborative process.
Collaborative divorce seeks to eliminate many of the factors associated with high-cost separations, such as fees for multiple attorneys and, therefore, more billable hours, trial preparation, and endless hearings and motions. The collaborative process involves utilizing a “neutral financial professional,” often a forensic accountant or someone of a similar profession. This neutral professional then assists BOTH parties to understand the various assets and the tax consequences associated with differing scenarios for asset division.. The financial professional also combs the financial history to uncover the fiscal generation, combined assets, and other revenue streams to ascertain a fair settlement amongst all involved parties. Not only does this process cost substantially less than a traditional separation and settlement, but it also lessens the burden on the judicial system in general. Couples no longer must contest every asset, as the neutral professional can assess fair values to each partner’s contribution and decide the fairest way to divide shared assets.
The goal of neutral financial professionals is to help you understand your finances so that you can make sound decisions with your divorce attorney. In other words, these are professionals who are trained to help you get the most out of any financial task you may need to carry out during your divorce. Besides, you only need one neutral financial professional in a divorce process—as opposed to each party hiring his or her professional—ultimately saving you money. Here are more ways a neutral financial professional can help you during your divorce:
- Gathering and analyzing the necessary financial documents
- Calculating and analyzing property tax billings
- Verifying your real estate property details
- Drafting plans for current and future expenses for your children
- Helping you and your spouse create a viable settlement option
- Identifying and helping you understand the separate property and financial claims
- Helping you understand the various pros and cons of financial-related options in your divorce case.
- Taking you through all the basics of divorce-related financial matters
- Helping with the valuation of real estate property, businesses, and other marital assets.
Divorce can be a harrowing and expensive ordeal, and when a couple has decided that it is time to call it quits, the last thing they want to do is drag out hearing after hearing trying to get what they believe is rightfully theirs. Add children to the picture, and it can become infinitely more tangled and messy. But, when partners are willing to collaborate and share the duties associated with a divorce, it makes for a much smoother transition to a life apart. Uniquely a life apart that is seen as the fairest for everyone involved. Collaborative divorce is a great way to show children that adults can work their problems out, and in doing so can get back to the task of being a parent.
Among those with high net worth, a divorce can be far more costly than those on a lower income scale. The truth is, there is just far more at stake when it comes to high net worth couples. However, if a couple can put their pride aside and work together, everyone can benefit. Thanks to collaborative divorce professionals, this path forward can help the couple to feel justified and intact after they dissolve their marriage and move on. Nobody must wonder if they should have fought harder or asked for more because a neutral party has already done the work for them. Not only that, but they have done the work at a substantially lower price than a traditional divorce.
The collaborative process also engages the services of a mental health professional as a neutral “coach.” The coach can meet separately with the parties and without attorneys to resolve parenting schedules and other children-related issues. The coach can also assist parties in a process that can become very emotional. The coach works with the parties to resolve emotional issues and in so doing, reduces their stress and anxiety. This does not happen in contested cases.
As with the financial professional, the coach can help in reducing the expenses often associated with contested divorces.
In a most recent study performed over a four-decade period, the global rates of divorce increased by more than double, from 2.6 per 1,000 marriages to 5.5 per 1,000 (DePaulo). These statistics were shown to average out across all countries, which means people across all walks of life and cultures are becoming more likely to seek separations from their marital partners. Not only are divorces, in general, becoming more common, the rates are higher than average among economic classes that are higher (DePaulo). As divorce becomes more prevalent and those with higher assets and net worth becomes more common still, the trend in collaborative divorce techniques should increase as well. Those who have made sound financial choices when it comes to their own lives would most certainly look for money-saving ways to separate. There are virtually no downsides to pursuing a separation in this manner. All parties get to walk away, feeling confident that they were given a fair shot at asset division.
Although divorce can be a negative experience, it can also be an experience of empowerment and freedom. Sometimes people fall out of love and want to separate and remain friends. Others want to separate but still take on their very active roles as parents. Often a divorce can be a blessing for one partner when staying in a bad relationship is the only alternative. In previous eras, divorces were highly unusual, and the social stigma encouraged people to stay in relationships that they were not happy or satisfied with. Today people can change circumstances when they are no longer happy. With collaborative divorce as an option, there is a way to try and make everyone as happy as can be given the situation. With the collaborative divorce option, everybody wins. Children get to see parents work out their differences, couples save money, courts are no longer tied up with unnecessary hearings, and everyone walks away feeling like they got the best deal. The sooner the couples come to an amicable agreement, the faster they can get back to living the life they think is deserved.