7 Insights on Advising Wealthy Clients in a Divorce

The process of navigating a divorce will always come with some degree of emotional and financial strain for clients, but advisors who help bring the right perspective and expertise to the table can mitigate a lot of unnecessary disagreement and suffering. This was one of the key highlights offered up this week by attorney Gus Dimopoulos, who specializes in high-net-worth divorces, in a wide-ranging interview with ThinkAdvisor. At this point, Dimopoulos has helped steward more than 500 client couples through the divorce process, and while there are nuances in each case, there are also some clear patterns. "Traditionally, you could point to four main drivers of divorce here in the United States," Dimopoulos said. "These are a loss of love and intimacy, disagreements about money and lifestyle, disagreements about religion and conflicts with the extended family." Increasingly, according to Dimopoulos, the topic of religion is less of a driving factor when couples find themselves in an irreconcilable conflict — but this has been replaced by deeper and more disruptive disagreements about how children should be raised. Relatedly, couples who earn enough to live comfortably may find that lifestyle creep and the age-old effort to "keep up with the Joneses" creates significant strain in the relationship. "We come across some very deep disagreements on whether or not a given couple should have certain creature comforts," Dimopoulos said. "It's like, do we join the country club or do we buy a new car? Do we send the kids to an expensive private school or will they be just fine in the local public school?" Perhaps the most important lesson for financial advisors working with wealthy clients is to understand that money doesn't need to be tight to be a driver of big disagreements between otherwise attuned couples. Additionally, divorce is never something gleefully sought out by a couple, but that doesn't mean the process can't be civil and beneficial for everyone involved. "The truth is that divorce is still a taboo subject in our society, but the financial and emotional strain of a divorce can be mitigated with the right perspective and expertise," Dimopoulos said. See the slideshow for a review of seven key lessons learned from managing high-net-worth divorces.