10 Mistakes to Avoid in High-Net-Worth Divorce Settlements

Price Family Law
Denver Family Law Attorney

Divorce is rarely — if ever — easy. However, when significant assets are involved, even the most amicable divorce can soon become a puzzle for all parties involved. While unforeseen issues can always arise, being aware of some common complications of high-asset divorces may help you feel more prepared for what lies ahead. Here’s a look at 10 mistakes to avoid in high-net-worth divorce settlements.

1. Not Hiring an Attorney

It’s always important to have a skilled attorney when going through any divorce, but in the event of a high-net-worth divorce, strong representation is even more essential. Many people erroneously believe you need a divorce lawyer only if your divorce must be decided in court. However, your attorney can help you through each step of the divorce process:

  • Filing all necessary documents
  • Evaluating financial disclosures
  • Looking for hidden assets
  • Helping you solve child custody issues
  • Ensuring property division is equitable
  • Advocating for you during negotiation, mediation, and litigation
  • Helping you formulate a plan for life after divorce.

Before choosing your attorney, you should make sure anyone you consider has specific experiences with couples undergoing high-asset divorces.

Any divorce can be emotionally challenging, but high-net-worth divorces introduce an element of financial complexity as well. The best way to protect your interests is to work with an experienced divorce lawyer.

2. Not Obtaining Proper Business Valuations

Many couples going through high-net-worth divorces have one or more businesses between them. In order to make sure the division of assets is equitable, you need to obtain proper, unbiased valuations. For instance, if your spouse primarily handles a business and says its worth is very low, you may be inclined to take their word for it. Your spouse may be speaking truthfully — but they also may be deliberately underplaying the business’s value so you’ll agree to let them keep it.

3. Hiding Assets

The Colorado Rules of Civil Procedure state that both parties in a divorce must completely account for all assets and debts. Each side must give the other a complete financial disclosure. Some spouses — typically those earning more than the other  — attempt to hide assets during this phase. They may open undisclosed accounts or transfer money to friends or family. They may even temporarily open an account in a child’s name, transfer assets into that account, and then close the account after the divorce has been finalized.

However, hiding assets can have serious legal and financial consequences. You may face fines and even jail time, and if you are found to have hidden assets during your divorce, a judge may award your spouse more assets than they would otherwise have received.

4. Not Investigating Your Spouse’s Assets

Even if you don’t intend to hide assets, it doesn’t mean your spouse won’t. You and your attorney should look closely at your spouse’s financial disclosure form to verify that it is complete and accurate.

5. Assuming Litigation Is the Only Path Forward

Not All Divorces Must Be Solved in Court

Even if you believe your divorce is going to be a contentious one, it’s worth negotiating with the other side or even attending mediation sessions before resorting to litigation. Alternative dispute resolution is often faster, less stressful, and less expensive than deciding your divorce through litigation.

Our attorneys can help you explore negotiation, mediation, and other forms of alternative dispute resolution before turning to litigation. Call Price Family Law at 720-615-1750 to get started with a free consultation.

6. Not Taking Taxes Into Account

It’s always important to consider taxes during a divorce. However, high-net-worth divorces tend to come with unique tax implications. For example, many couples liquidate some of their shared assets during the divorce process, but that liquidation can trigger hefty capital gains taxes. If you don’t carefully consider taxes, you might end up receiving a settlement that’s much smaller than what you were expecting.

7. Lying to Your Attorney

It might be tempting to lie to your attorney about sensitive issues like infidelity, but this is a mistake. If you want your lawyer to represent you as well as they can, it’s essential to tell them the whole truth. Your lawyer isn’t there to judge you — they are there to look out for your best interests.

8. Rushing

It’s completely understandable to want to finalize your divorce as soon as possible so you can move on with your life. However, if you accept the first settlement offer or otherwise try to speed through the process, you may end up with far less than you could have.

9. Making Decisions Based Purely on Emotion

Divorce is a highly emotional process. And when emotions are running high, it becomes difficult to make rational decisions. When there are significant assets on the line, a split-second decision made out of spite, anger, or exasperation can have long-lasting financial consequences. Always consider every decision carefully and ask for input from your lawyer. Divorce attorneys are knowledgeable about the law, but because they aren’t emotionally involved in your divorce, they also can help you make sound decisions.

10. Forgetting About Estate Planning

Estate planning may not seem closely related to divorce. However, once the divorce is complete, updating your estate planning documents is a key final step for protecting your assets. Many people have their spouse listed as a beneficiary on life insurance policies and other estate planning documents, so you should update your estate plan as quickly as possible to ensure your money is used the way you intended.

Are You Facing a High-Net-Worth Divorce?

The Right Divorce Lawyer Can Help Protect Your Future

If you’re navigating a high-net-worth divorce in the Denver area, Price Family Law is here to help. Our attorneys have decades of experience helping Colorado families like yours handle the intricacies of divorce, spousal support, child custody, and related issues. We are skilled negotiators and litigators, but we’re also here to offer the support you need while weathering this difficult season of life.

If you’re involved in a high-net-worth divorce or think you may be soon, finding experienced legal representation has never been more important. Call Price Family Law at 720-615-1750 to set up a free consultation today.

Request Free
Consultation

Please complete the form below to let us know how we can help you. Our team will be in touch to arrange a consultation.

    Attorney Trista Price

    Trista McElhaney Price is a founding partner at Price Family Law, LLC. She specializes in high-asset divorce cases and legal matters involving complex business and financial issues as well as complex custody matters involving domestic violence, substance abuse issues, and mental health issues. Read Full Bio.