Why You Need a Lifestyle Analysis for Your Divorce

When a couple divorces in New York, one of the court’s goals is to ensure that both spouses can maintain a standard of living that is similar to that they enjoyed during the divorce and that assets are divided fairly. In reality, after the divorce, the amount of the assets remain the same and must be divided and distributed among two households after the divorce, making it challenging to keep each spouse at the same standard of living they enjoyed before the divorce.

However, your goal is to ensure that you receive enough assets and alimony (if applicable) to be able to maintain a lifestyle that is as close as possible to that you enjoyed during the marriage. This means your attorney needs to demonstrate the standard of living in the marriage and accurately project the assets you need to continue to live at that level. A lifestyle analysis can ensure you are treated fairly when it comes to asset division and the establishment of support.

Disclosing Financial Information in Divorce

New York courts require each spouse to complete and submit a Statement of Net Worth (sometimes called a financial affidavit). This is a lengthy document that is intended to provide a complete picture of both spouses’ assets, incomes, and debts.

In a complex divorce, there is a lot of information to organize, disclose, and analyze through this document. Each spouse must sign their own affidavit, swearing that the information contained in it is true. This document, along with supporting evidence and documentation, is what is used to determine property distribution, spousal support (also called maintenance or alimony), and child support.

Obviously, you will not complete this document yourself since it is highly complex. And while your attorney will be instrumental in creating the document, the information therein will come from your team of accountants and financial managers, both personal and business. Since this document is so complex and includes so many pieces of information, it can be difficult for it to provide an accurate picture of your actual lifestyle before the divorce. The financial affidavit provides a snapshot of marital assets and income at one point in time at or near the time of the divorce filing.

It does not provide a long view picture of what the marital lifestyle actually was over the years or a clear and accurate projection of your lifestyle and expenses after the divorce in the years to come. Remember, the goal of the divorce is to place each spouse into a lifestyle similar to that they enjoyed during the marriage so that their future years are financially supported. Because of this, you may need a lifestyle analysis.

What is a Lifestyle Analysis?

The purpose of a lifestyle analysis is to provide a clear portraiture of what your lifestyle actually was during the divorce so that the court can clearly see how you lived and then use that information to create a divorce plan that allows you to continue maintaining the style level of lifestyle after the divorce.

Your financial affidavit does not provide a clear picture of this because that document is focused on looking only at the actual financial circumstances at the time of the divorce and are created using estimates when it comes to future lifestyle.

Accountants are excellent at providing financial records and analyses but do not generally provide accurate future estimates. A lifestyle analysis definitively analyzes your true married lifestyle in detail, examines actual expenses, and projects future expenses accurately. It includes:

  • A clear depiction of what the daily living expenses were during the most recent years of your marriage.
  • An honest evaluation of both spouses’ spending habits during the most recent years of the marriage.
  • A detailed explanation of how money was spent during the marriage and by whom.
  • A representation of what each spouse’s future expense will likely be.

The financial professional handling the analysis will examine in detail:

  • Tax returns (personal and business)
  • Retirement accounts
  • Receipts and transfers
  • Purchases and payments
  • Pay stubs
  • Debts and liabilities
  • Credit reports
  • Credit cards
  • Business interests and ownership as well as details of business profit and loss and other detailed financial analyses
  • Bank and investment statements

A lifestyle analysis goes above and beyond the Statement of Net Worth provided by your own financial team. It carefully analyzes you and your spouse’s expenditures and financial positions and projects how those will continue after the divorce. The court uses those projections in setting alimony, child support, and property distribution amounts. The analysis is done by a trained forensic accountant with experience in divorces, who know where to look and what to evaluate to better your case and maximize your outcome.

How a Lifestyle Analysis Benefits You

A lifestyle analysis provides a clear and detailed exposition of how money was spent and managed during your marriage. There are three situations in particular where a lifestyle analysis is absolutely necessary.

  1. Hidden assets. One of the key benefits of a lifestyle analysis is that it can expose hidden assets held by your spouse. Hidden assets are a great concern in a divorce. Your divorce attorney has a variety of tools and methods at their disposal to locate hidden assets. Still, generally, when assets are held in offshore locations, your attorney is unable to subpoena the records from the financial institution because the divorce court has no jurisdiction over institutions in other countries. Thus, the entire process relies on your spouse truthfully disclosing those assets.

    You may believe your spouse will be less than honest about this. A lifestyle analysis can uncover withdrawals, payments, transfers, and missing funds that will establish the likelihood of hidden assets. You are entitled to a portion of those hidden assets, and they should be included when calculating your future lifestyle expenditures.

  2. Hidden income. The analysis can also reveal hidden sources of income that your spouse has failed to disclose. If the analysis shows that the marital lifestyle exceeded the reported marital income, it’s clear there is additional income that is not being disclosed. Proving this exists can result in a higher property division and higher spousal support payments.
  3. Financially controlling spouse. If you were in a situation in your marriage where your spouse was the person who managed marital finances and assets, you may be particularly in the dark about the financial facts of your marriage. A lifestyle analysis draws all of the information into the light so that a fair divorce financial distribution can be put in place. The analyst will uncover all of the details about where funds came from, how they were used, and what financial decisions your spouse made about marital funds.

A lifestyle analysis carefully traces each and every expenditure made by each party during the recent years of the marriage, including the movement of funds and the existence of undisclosed income, and possibly the mysterious disappearance of funds that may be funneled to offshore accounts. The more assets you can show the court, the more assets you will receive in the divorce.

A lifestyle analysis can also be used to show that the funds needed to support your way of life are higher than your spouse is projecting or that you have fewer assets than your spouse is claiming.

Getting your fair share in your divorce hinges on the court having an accurate and robust depiction of the assets, incomes, debts, and expenditures involved in the marriage. A lifestyle analysis ensures the court has all the information needed to correctly determine asset distribution and support.


Eric Weinstein

Eric Weinstein, a partner at New York matrimonial litigation firm Bikel Rosenthal & Schanfield, brings an unconventional approach to the high-conflict disputes over complex assets for which the firm is known.

Eric’s reputation for skilled diplomacy and successful negotiation is backed by three decades of experience litigating high-stakes disputes in New York’s state and federal courts, related to the high-value assets, complicated income streams, and unique financial circumstances characteristic of high-net-worth New Yorkers and their spouses including.

To connect with Eric: 212.682.6222 | Online

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