Here some advice for those going through a divorce:
Leave your emotions at the door. Divorce court is not the place to go for therapy or revenge. Insisting that your spouse’s affair go on the record may give you the temporary satisfaction of smearing his or her public image and win you some sympathy with the neighbors. But proving that your spouse cheated doesn’t entitle you to a bigger settlement.
You’ll get better results with claims of the “I gave up my career for you” variety, provided you can prove that the 12 years you spent keeping house actually helped your spouse finish grad school or climb the corporate ladder. But remember that divorce court is primarily about money, not emotions. Which leads us to our next point…
Do your paperwork. In divorce court, knowledge is power. If you don’t know how much your spouse makes or what properties she owns, you might wind up settling for less. So your first job should be to compile a complete picture of how much wealth your spouse possesses and owes and where she’s keeping it.
Even happily married couples should stay up to date on each other’s finances by insisting on a detailed rundown at least once a year. And,if you’re growing tired of your marriage or you sense that your spouse is, you should “start paying more attention and start keeping records.” Once divorce proceedings have started, you may not be able to lay hands on important financial documents, such as proof of stock ownership or recent statements of net worth, that you will need to plead your case.
Seek a pro’s opinion “Don’t just storm out the door and say, ‘I’m gonna see a lawyer.’ Go see a lawyer and then decide whether you want to storm out the door.
A good divorce lawyer will need only a 45-minute consultation to tell you how your case will probably turn out, including who will get custody of the kids, how the property will be split, and who will pay what. For example, it’s more than likely that if you walk out first, you’ll lose possession of the house.
One example is a client who wanted to divorce his stay-at-home wife, who had been out of the workforce for a number of years raising their kids. The client was shocked to learn that his wife would be entitled to sizeable support payments, perhaps indefinitely. She would also get half of not just the family assets, but his personal stock portfolio and other assets as well.
The man decided to stick out his marriage for a while longer — but with an eye to leveling the financial playing field. He spent more time raising his children and encouraged his wife to go back to work. Meanwhile, he kept personal assets that would be considered exempt from property division in court (like inheritance money) out of the family pot. When he finally did file for divorce a few years later, the financial settlement was a lot less punishing to him.
Budget for the break-up It’s a good idea to decide early on how much you can afford to spend on your divorce. While your angry side may tell you to hire a hotshot lawyer whose motto is “nail the son-of-a-gun to the wall,” the reality may be that you can’t afford to keep paying your lawyer’s bills if your divorce drags on. Every motion, argument and phone call your lawyer makes on your behalf results in an invoice, and a litigated breakup will probably cost $40,000 to $100,000.
To save time and money, many affluent couples are choosing to have their divorces settled through arbitration. They agree to have a retired judge or retired lawyer hear their case and make a binding decision on who gets what. Depending on the size of the estate, arbitration costs about $15,000 — much less than a court divorce. It’s faster too. Instead of waiting for months to get a court date, several of the divorcing couples into arbitration have settled in just six weeks.
Whether you choose arbitration or litigation, investing in the services of a certified divorce financial analyst can help trimyour legal bill. These professionals typically charge $150 to $250 an hour and are part of a small but growing specialty.
Plan your defense. So what happens if you fear that the person you’re about to marry may one day take you to the cleaners? Think prenup.
A prenup is a legal contract you sign before your marriage that lays out how the assets you own individually and together should be divvied up if you ever divorce. Once drawn up by a lawyer, a prenup acts “like an insurance policy “It’s best if never used, but it’s invaluable if you need it.”
Make sure you have a divorce financial advisor on your team so you fully understand the short- and long-term financial and tax implications of any decisions that are made during the divorce negotiation process.
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