If you and your divorcing spouse have significant financial assets, there may be a great deal of uncertainty regarding the future of your financial holdings. Although there are many things you can’t control about your estate – such as the stock market’s dramatic downturn this year – what you can control is how you go about your divorce. Two critical concepts that can benefit the divorce planning of high asset couples and improve outcomes are: (1) looking to the future and (2) identifying joint interests.
- Looking to the Future. The key is to develop a vision for where you want to be five, ten, and twenty-five years from now, and then to be strategic and creative in planning how to get there.
- Identifying Joint Interests. All too often, high asset couples put their energy into an adversarial “fight” as they go about getting divorced. However, if you can identify your spouse’s interests and craft a settlement proposal addressing both of your interests, it becomes easier for your spouse to say “yes” rather than “no.” A settlement along these lines can result in saving significant amounts of money, emotional energy and time.
Michael and Susan (not their real names) embraced both of these principles in their divorce process. Michael and Susan’s divorce was a classic high asset divorce: they had significant inherited wealth, two highly-appreciated homes, a profitable business, as well as substantial retirement and investment interests.
Working with divorce attorneys who were committed to and skillful at achieving mutually-agreed settlements, they identified the following future-oriented joint interests:
- to continue to enjoy their beach property with their children and grandchildren;
- to continue to implement the estate plan they had jointly drawn up to gift assets in a tax-advantageous manner to the second and third generations;
- to each have the type of residence that met their future entertaining and lifestyle needs;
- to each maintain their current standards of living through their retirement years;
- to find a way to divide the value of the business without diminishing its profitability;
- to not necessarily be limited by the legal characterization of property interests as “marital” or “separate” in crafting the best settlement for them.
The mere process of identifying these joint interests made some of the solutions obvious and more achievable. With the assistance of financial and estate planning experts, Susan and Michael were able to arrive at an attractive global settlement that incorporated careful tax and estate planning and met all of their joint goals. Other benefits included minimizing their legal fees and maintaining family harmony through all of the generations.
If you are about to commence a high asset divorce in Maryland, Virginia or the District of Columbia, it is critical to give careful consideration to the type of settlement process you want to utilize and to identify an experienced divorce attorney who will assist you in pursuing the type of divorce you desire.