Go through financial documents in a divorce is a task that many wish to avoid, though it is a necessary evil. This exercise is called a Lifestyle Analysis. Years ago it was common for one spouse to seek large monthly support, the other spouse to plea a fraction of that, and the court to “split the pie in half.” Today the court is equipped to understand how the couple’s lifestyle relates to support determination. In fact, this process not only identifies the ordinary living expenses, it also identifies unusual, occasional, seasonal, and non-recurring expenses.
Today this analysis is required not only by the “non-money” spouses seeking Pendente Lite relief, but often by both parties. The investigation of the couple’s “marital lifestyle” has become a hot topic. In fact, the court has welcomed this exercise as a valuable tool that has influenced both Pendente Lite support orders and the final financial divorce judgment. At the very least, the investigation of the couple’s lifestyle keeps the litigants and their counsel on their toes when it comes to submitting net worth statements.
The laborious chore of locating and interpreting documents is not attractive. Many are not truly aware of their economic situation, particularly those not in control or responsible for the household finances. Even a slight miscalculation can influence the Court’s judgment.
Support in this tedious chore is a welcomed relief by many in the midst of divorce and their counsel. This effort generally includes:
- Analyzing personal and business income tax returns,
- Analyzing bank statements, brokerage statements, and credit card statements,
- Investigating the nature and frequency of significant spending,
- Identify non-recurring and seasonal expenses, and
- The review of credit reports.
This exercise has identified unknown spending patterns of has uncovered gambling and drug habits, the accumulation of art and collectables, the dissipation of marital assets, and even extramarital relationships.
Once the records are analyzed, calculations regarding the monthly and annual average spending can be determined. A well-prepared lifestyle analysis provides incalculable benefits to counsel, clients and the Court. Attorneys gain strategic advantages in fighting for the monetary settlement their client deserves; and Judges use the analysis as a catalyst for rendering an equitable decision. All in all, the analysis of the marital lifestyle is an imperative and valuable tool.