Filing for divorce in Connecticut can be a challenging time for anyone, including families with substantial assets and/or income. There is no bright-line test for what is labeled a high-net-worth divorce, but suffice it to say that the colloquial expression, “you know it when you see it” probably applies. In many respects, the income and asset level in a divorce makes no difference to us at McConnell Family Law Group as we strive to deliver positive outcomes for all our clients. That said, as discussed below, there are specific tools and pragmatic solutions that come into play for high net-worth divorces that are not present in other cases. It is necessary for high- net-worth divorce clients to have counsel who work with and understand all aspects of these particular dissolutions.
Division of property
Like many other states, Connecticut follows the equitable distribution approach to dividing marital assets and income, often referred to as the “marital estate.”
Under Connecticut law, the court may consider many factors in dividing the marital estate, including, but not limited to:
- The amount and sources of income of each spouse
- Earning potential of each spouse following the divorce
- The length of the marriage
- Whether there are children
- Whether a spouse left the workforce to raise children
- The ages of the spouses
- The health of the spouses
- The contribution of each spouse to the acquisition, maintenance, and appreciation of marital assets
Tools for high-net-worth divorces
It is often necessary and quite common to retain outside experts in high- net-worth divorces. For example, a forensic accountant may be needed to account for variable and independent income streams. The accountant may also be called upon to value specific assets such as a closely held business, or the potential future income related to carried interest holdings and/or equity interests. The accountant or other financial professional may also be needed to perform valuations and formulate recommendations regarding possible division scenarios for pensions, retirement accounts, deferred compensation, and restricted stock options. Other experts may be called upon to appraise real estate, jewelry, precious metals, antiques, art, automobiles, and the like.
As with any case, a child psychologist and/or mental health professional may be retained to assist with parenting and custody-related issues.
At McConnell Family Law Group, we routinely work with experts across a spectrum of professions. We have a “Team-100” list of referral sources that we rely upon to assist our clients. Through our involvement in high net-worth divorce cases, we have found that many high-net-worth divorces involve more litigation than is warranted. We try to avoid litigation to the maximum extent that we are able, but we also know that being excellent and respected trial lawyers leads to favorable settlements. As Attorney McConnell’s former boss, General James Mattis, once said in describing his Marines – “no better friend, no worse enemy.” We believe this maxim is applicable to the way we practice matrimonial law.
Adjusting to a new life
If your spouse makes a lot of money, you might have grown accustomed to a certain standard of living. You likely will lose access to this high and steady stream of income once your divorce becomes final.
Many people find it difficult to transition from a household with a six or seven-figure income to life as a single parent. Some people put off their divorce for as long as possible because they cannot imagine transitioning to a new neighborhood, school system, lifestyle or circle of friends.
High-net-worth divorces can be even more challenging for those who are trying to raise children. Before the divorce, you might have been a stay-at-home parent. Some wealthier families have nannies to help them raise their children. After the divorce, the custody arrangement may dictate that you will be raising the children essentially on your own. This would probably entitle you to child support under provisions of Connecticut Family Law, but you still may have to re-enter the workforce if you have not been employed, juggle getting the kids to school and activities, and pay for childcare.
At McConnell Family Law Group, we strive to help each family in “Finding Peace Through Strength.” Take the first step now and contact our office in New Canaan (203) 344-7007; New Haven (203) 344-7762; or Hartford (860) 266-1166. Or visit us at www.mcconnellfamilylaw.com