If you and your spouse share a significant asset portfolio, divorce can be devastating to your financial future. However, divorce is not something that usually happens overnight. Many divorcing couples saw the writing on the wall for quite some time before making the actual decision to divorce.
In a high-asset divorce, this advance preparation can help you take certain steps and make strategic decisions that to protect your financial future. If you are on the verge of a divorce that involves high net worth, read on for some essential tips you should know before approaching your divorce proceedings.
1. Begin collecting financial documentation immediately.
Once a divorce is imminent, some spouses may try to hide assets so that their wealth is not subject to division by the courts in the divorce proceedings. If you suspect you will face a high-asset divorce, you should begin to document your financial picture as soon as possible and with as much proof as you can. Collect bank statements and account information, as well as a comprehensive list of your assets such as property, vehicles, art, boats, etc. Part of facing your financial situation in a divorce is appropriate preparation regarding the assets at stake.
2. Determine whether your state is a community property state.
Washington is a community property state, along with a handful of other states. This means that if you are divorcing in Washington state, the courts view your marital assets as joint property subject to an equal split, which has a direct impact on your financial future and holdings after the divorce. However, the courts may not consider all property as community property.
3. Work to keep your decision-making on a rational, not emotional, level.
Divorces are highly emotional, but if you make decisions based on your fluctuating emotions, you are likely to make decisions that will not serve you well in the long-term. As you approach your impending divorce, make an effort to focus on the rational, logical and objective aspects of your decisions and not the way you feel in the moment.