There is no question of just how valuable a prenuptial agreement can prove to be in the event a couple decides to divorce. That’s because this binding contract, executed by a couple beforethey tie the knot, establishes certain rights and expectations as to how their property will be classified and divided in the event of a split.
While it’s certainly true that people of any means can benefit from having a prenup, those who have significant assets perhaps stand to benefit the most from having this legal document in place.
However, not every wealthy couple executes a prenup prior to their marriage. For many, this may be a purely personal choice motivated by their belief that their marriage will stand the test of time, while for others it may be attributed to the fact that they had relatively little when they were married and only accumulated wealth over the course of the marriage.
Not surprisingly then, a divorce can become significantly more complicated for wealthy couples when there is no prenup in place. That’s because these couples not only have to deal with the emotional difficulty that accompanies most splits, but also deal with otherwise complex financial details.
Fortunately, experts have identified a few ways that wealthy spouses going through a divorce can make the process easier for themselves while still protecting their financial interests.
Don’t make assumptions about how things will play out in court
Experts indicate that wealthy spouses often mistakenly believe that divorce litigation is the best and only route of securing what they believe to be the most equitable result. However, this isn’t always the case.
“There are options besides court that have a higher probability of getting you what you want and getting you what you want privately,” said one expert. “Having your net-worth statement and personal dramas splashed across ‘Page Six’ is not what most clients set forth as goal number one in their divorce.”
Instead of defaulting to divorce litigation, these experts urge wealthy spouses to perhaps consider divorce alternatives.
Don’t neglect the importance of securing a complete financial forecast
Despite the sizeable assets at stake, experts indicate that many wealthy spouses fail to take the necessary steps to ensure that each and every financial detail has been accounted for. Fortunately, this is starting to change, as more and more people are deciding to bring certified divorce financial analysts into the discussion.
“While financial divorce specialists complement and can never replace divorce lawyers, their role is to — from the start of the process to after the divorce is finalized — ensure the financial well-being of their clients,” said one divorce financial analyst. “For example, they’re often extremely effective in providing the supporting evidence for settlements.”
Regardless of your income level, consider speaking with an experienced legal professional if you would like to learn more about the divorce process, including property division, spousal support and other important issues.
Source: Forbes, “Three of the biggest mistakes the wealthy make when divorcing,” Russ Alan Prince, June 9, 2014