A high-net-worth divorce generally means the spouses have more than $1 million in liquid assets at stake. As such, it presents unique and intricate challenges that distinguish it from divorces involving less resources. With the current sharp rise in real estate values, an increasing number of couples find themselves with multimillion-dollar portfolios that must somehow be divided should the marriage be dissolved. 

A high-net-worth divorce usually presents these significant considerations:

• Diverse asset portfolios — Wealthy individuals often possess not only real estate but also investments, retirement accounts, business interests, luxury items and other valuable assets. Each type of asset requires careful evaluation to carry out an accurate division. The valuation process itself can be contentious, as both parties may have different opinions on the worth of specific assets. Real estate appraisals can vary and the value of investments can fluctuate, adding additional complexity.

• Hidden or undervalued assets — In some cases, one spouse may attempt to conceal assets to avoid sharing them in the divorce settlement. This can involve transferring assets to offshore accounts, undervaluing property or even using complex financial instruments to obscure ownership. Another tactic is to understate the value of assets so that the other spouse receives less. Forensic accountants and financial experts are often employed to uncover these hidden or undervalued assets, so that there can be a fair division of property.

• Significant spousal maintenance — In high-net-worth cases, the amount of spousal maintenance, commonly known as alimony, can be significant, leading to potential disputes and prolonged negotiations. A higher award may be sought in consideration of the lush lifestyle enjoyed during the marriage. Factors such as the duration of the marriage, the age and health of both parties, and the earning capacity of each spouse are considered. 

• Business valuation and protection — Among the most challenging aspects of a high-net-worth divorce are the valuation and protection of a business owned or partially owned by one of the spouses. Determining the value of a business requires a thorough analysis of financial statements, assets, liabilities and future earning potential. The non-owner spouse’s involvement in the business, whether in providing services or other types of contributions, can complicate matters further. One spouse may wish to retain control of the business, while the other may seek compensation for their share. 

• Emotional strain — Beyond the financial complexities, high-net-worth divorces often involve significant emotional strife. The higher stakes and the potential for prolonged legal battles can take a significant toll on both spouses’ psychological well-being. The involvement of children, public scrutiny and possible impact on one’s lifestyle can exacerbate the stress and tension. Spouses undergoing a high-net-worth divorce should have a support system in place.

At Clark and Schloss Family Law, P.C. in Scottsdale, Arizona, we help spouses dealing with the unique concerns of high-net-worth divorce. For a free initial consultation, please call our office at 602-789-3497 or contact us online anytime.