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Addressing executive compensation during divorce proceedings

On Behalf of | Nov 15, 2023 | Divorce

Financial considerations often arise when filing for divorce. Sometimes, one spouse earns significantly more than the other, so the post-divorce life for the other spouse may come with financial concerns. For those worried about receiving a fair distribution of assets in a Texas family court, it could be worthwhile to examine any executive compensation packages that the other spouse earned. Sometimes, the compensation package could be significantly worth more than the person’s regular salary.

Matters related to executive compensation

Executive compensation packages will vary from person to person. In some instances, an executive could receive year-end bonuses based on performance. Others may receive additional perks, such as a paid corporate car or travel reimbursements. Stock options could be the more complex benefit, as a company could pay someone in shares of the stock, but they must work for a certain number of years to receive such compensation.

Stock options could be complex to understand because their value may differ from what it is worth today to what it will be worth when the executive chooses to cash out. Weighing the value of these stock options might become a critical part of divorce settlement negotiations.

Fair distributions

There are several reasons why both spouses may consider an equitable settlement. For someone with limited earning potential, seeking a proper distribution of the assets and receiving spousal support could be helpful. A thorough examination of an executive compensation package may help determine what is equitable. Child support also factors into the process. Receiving appropriate child support could help ensure that any children from the marriage are being cared for after the high-asset divorce.

There may be issues of contention that arise during settlement negotiations. Working with a mediator might resolve such issues, and the divorce might end amicably.