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Divorcing a millionaire? You’ve got some major financial issues to consider

| May 3, 2021 | High-asset Divorce

Divorce is never easy. When your spouse is a highly-placed executive or a professional who is part of a thriving practice, however, the odds that your divorce will get complicated and messy is higher than usual.

If you’re divorcing someone with a million (or millions) in the bank, you’re likely to need experienced, clear guidance on a number of complex financial issues, like the ones listed below.

Stock options and restricted stock options can be an issue

When your spouse is highly placed in their company, dividing the real estate and figuring out what happens to the pension plan probably won’t be the most difficult question you face.

Instead, you need to look out for executive-level compensation packages that may not be clearly reflected in your marital holdings. These include:

  • Stock options. If your spouse has stock options that haven’t vested yet or stock options that have vested but haven’t yet been exercised, you may not have any real idea (yet) what those will be worth.
  • Restricted stocks. Sometimes called “golden handcuffs,” these stocks keep high-profile executives tied to their jobs until they vest — and that may not be until after your divorce is over. You need to understand when they vest to understand what you are due.

The language in your divorce agreement must include provisions that address how such stocks need to be held until they can be exercised or sold, who will pay the taxes on the proceeds and other important details.

Work with an attorney who understand the stakes

High-worth divorces are usually anything but typical, so it pays to be patient and deliberate about your actions. Anything less and you could end up forfeiting your right to a considerable amount of money. It’s wise to start working with an experienced attorney as early as possible.