Divorce is difficult for most people, especially when it comes to financial and legal matters. If you are ending a high-net-worth marriage, the process can be even harder. When significant assets and wealth are at stake, it can cause more stress, arguments and mistakes.
The good news is that you are not the first person to go through a high-asset divorce in Colorado, which means you can learn from others’ mistakes. Here are some major errors to avoid during a divorce with complex assets.
Rushing the process
It is understandable to want to get the divorce over with as soon as possible, but this is often not the best decision. If you try to hurry through your divorce, you are more likely to make financial mistakes. Once the court issues the divorce settlement, there are no do-overs. You only get one shot at negotiating what you want and valuating assets. Take your time to ensure you are making the right decisions.
Forgetting tax implications
Many of the financial transactions that take place as a result of your divorce have tax consequences. This includes property division. Keeping the family home or living off of a retirement account can look a lot different once you factor in the post-tax value of the assets.
You may feel a desire to hide assets from your spouse, especially if you are the higher earner. But this is one of the biggest mistakes to make in a high-net-worth divorce. The idea is that you may be able to shield assets from the division process, meaning you get to hold on to more of your wealth. However, it is actually relatively easy for spouses and their attorneys to uncover hidden assets. If this happens, you lose all credibility during the rest of the process. The judge will not look favorably upon you, and you may end up losing even more.