Have you ever listened to the Wall Street Journal podcast called "Watching Your Wealth" with Veronica Dagher? Last week's episode touched on an interesting subject: the idiosyncrasies of a divorce involving significant wealth.
Dagher interviewed a New York City divorce attorney who made a couple of great points, one being that judges tend to have a lot of discretion when they are handling a high-asset divorce.
Typically, before making a decision in any type of case, judges consider applicable statutes and case law that has been presented by the attorneys.
However, statutes and case law are pretty limited when it comes to governing high-asset divorce as most apply to lower- or average-income scenarios. Therefore, the outcome of a high-asset divorce is often up to the judge's own discretion.
What this means is that there is a lot of room for creativity when it comes to asking the court for what you want in a high asset divorce. It also means that it is extremely important to have a skilled and effective attorney on your side who can convince the judge to rule in your favor.
Lifestyle becomes an important piece in high-asset divorce
Typically, in a high asset divorce case there is one spouse who is wealthier than the other. In this situation, there tends to be a lot of focus on lifestyle.
The less-wealthy spouse may present evidence of the type of lifestyle that he or she enjoyed during the marriage, and what type of settlement would allow for that lifestyle to continue after the divorce.
The wealthier spouse, on the other hand, may argue that the lifestyle claims are exaggerated or impractical after the divorce turns one set of living expenses into two.
Interestingly, the attorney interviewed in the WSJ podcast said that when a wealthier spouse starts pushing the other spouse to cut back on spending, it could potentially be in effort to reduce a future divorce payout and a sign that a divorce papers are coming.
The economy can effect which spouse files
Finally, the podcast raised an interesting observation of how high-asset divorce is often tied to the economy and stock market.
When the economy is doing well, the lesser earning spouse is more likely to file for divorce because it will lead to a bigger settlement; and when the economy is not doing well, the higher-earning spouse is more likely to file for the opposite result.
Anyone who is part of a high-asset marriage that could be coming to a close should seek out help from an attorney right away -- and not just any attorney, but one with years of experience handling high-net worth cases.