Avoid these 5 high-asset pitfalls in your divorce

Avoid these 5 high-asset pitfalls in your divorce

You’ve worked hard for what you have. If you’re one of many Washington spouses who are preparing for property division proceedings in a divorce, it’s understandable if you’re worried about protecting your financial interests. With a high-asset net worth, there’s a lot at stake. By avoiding certain mistakes, you increase your chances of obtaining a fair and agreeable settlement.

Washington is a community property state, meaning that the judge overseeing your divorce will undoubtedly split all marital property between you and your ex 50/50. If you have a prenuptial agreement that identifies certain assets as separately owned, such assets may not be subject to division.

Close all jointly owned credit card accounts

In addition to any property or assets you’ve acquired during the marriage, you and your ex are also equally responsible for the marital debt. One of the biggest mistakes people make in a high-asset divorce is leaving credit accounts open in both spouses’ names. If your ex runs up a high balance, you could be responsible for at least half of the debt.

Do not overlook tax implications

If you have an IRA, 401k, or other retirement benefits account, it can have a significant impact on your divorce settlement. There may be taxes involved, particularly penalties for early withdrawals. Make sure you seek clarification on such issues before heading to court in order to protect your financial interests.

Make sure you show up in court with all relevant documents on hand

Are you the type of person who saves every receipt and has folders upon folders of documents at home regarding bank account information, investments, expenditures, and all other financial details of your life? If so, that can be helpful when it comes time to propose a property division agreement.

On the other hand, lack of documentation can cause obstacles, especially if you’re unaware of basic information, such as how much you paid for the house, how much you still owe on your mortgage, or what the balances are on your financial accounts.

Refusing to seek alternative methods of dispute resolution

The longer it takes to achieve a high-asset divorce settlement, the greater the chances are of something going wrong. The last thing you need is to become entangled in a lengthy court battle over marital property. When your goal is to move on in life in a healthy and productive manner, it’s easier to do so if you can peacefully negotiate a settlement.

It’s not only okay to consider other forms of dispute resolution besides litigation, it may be just what you need to finalize your divorce in a swift and amicable fashion.

Full disclosure is required

When you and your ex decide to go your separate ways, you must each fully disclose all marital property, assets, and liabilities. Failing to disclose information by mistake or intention can cause substantial delays and other impediments to your divorce settlement.

It is important to be honest and thorough so that you can achieve a fair deal in accordance with state property division regulations. Learning more about full disclosure laws ahead of time is a helpful way to avoid high-asset divorce mistakes.