Hamm’s Uneven Monetary Split Reminds us of Post-Divorce Financial Distress
In early November, the heat was on in Oklahoma City as a multimillion-dollar divorce finally came to a close. The marriage of CEO of Continental Resources, Harold Hamm, and his wife of 26 years, Sue Ann, was finally resolved.
Since the filing of papers, the media couldn’t seem to get enough of the Hamm’s high profile (and high dollar) divorce. The scathing details about the split between the billionaire CEO and his wife did not go unnoticed, and for good reason, too.
The divorce papers were filed in 2012, and according to Mr. Hamm’s statements, this divorce was a long time coming. We learn from an article in the New York Times that despite their plentiful bank accounts, their marriage lacked love for at least ten years. The Beatles said it best: money can’t buy you love. But if you asked the Hamm’s, it certainly buys you a tumultuous, top dollar divorce.
After a two-year divorce settlement and two and a half month trial proceeding, Harold was ordered to pay $995.5 million to his ex-wife, Sue Ann Hamm. The parameters state that he must pay $320 million by the end of the year and the rest is to be divided up into monthly installments of at least $7 million.
The Hamm’s did not have a prenuptial agreement, and according to the report in Forbes, in Oklahoma the assets are typically split up when they’re earned as a result of one spouse’s “efforts or skills.” The court only deemed that $1.4 billion of Harold’s near $18 billion in earnings were accumulated due to his actual efforts. Therefore, that was the portion split between the spouses. Sue Ann was given around 70 percent of the portion “earned by effort or skill.”
While our eyes may glisten at the sight of this generous cash sum, in reality, the estranged Ms. Hamm is only receiving about 7 percent of their complete marital assets. Meanwhile Harold and his Continental Resources stockholders are rejoicing, to say the least.
Although we have to take into account that every divorce circumstances and proceedings are unique, the percentage is still quite low. There is obviously no guarantee, but traditionally when marriages are as long as the Hamm’s (26 years), the wife has received at the very least 20 percent of the marital assets.
It’s difficult to feel sympathy for the divorced Ms. Hamm as she does still walk away with overfilling bank accounts and plentiful property, but in reality, she did get the short end of the stick. And according to a recent blog in the New York Times, many other divorced women suffer the same fate, walking away with percentages less than their estranged spouses. Most divisions of asset calculations aren’t in the billions, either.
It is no mystery that when spouses divorce, their lives separate. Bills that were once split in half are now paid individually. Salaries that were once shared aren’t anymore. And in exception of the grocery and the water bills, these bill amounts don’t get any smaller. The bills remain the same amount, but the income significantly decreases. The New York Times blog mentions that, on average, a man’s income post-divorce drops around 23 percent. Meanwhile, a woman’s income drops just over 40 percent. When you are paying mortgage-by-mortgage, bill-by-bill, that loss of 40 percent can be distressing. These situations can be the most financially distressing for spouses divorcing in their 50s, and this is becoming more and more common. As we discussed in a previous blog post, around 25 percent of older adults aged 50 and over are getting divorced.
After pouring through the Harold and Sue Ann Hamm headlines and looking at all of these numbers, it’s difficult not to feel anxious at the thought of a divorce, especially after enduring a marriage 25 years or longer. We don’t want to prepare for this fate, just like we don’t want to craft estate plans and save for our taxes. And regardless of the amount of preparation, divorce can be a confusing time for you, your spouse, and the rest of your family.
If you and your spouse are getting divorced, it is your divorce lawyer’s job to help you examine all the options to do what they can to ensure that you are financially able to cope post-divorce. As a St. Louis divorce lawyer, I know that each divorcing couple that comes into my office is unique. Not every family has the same situation as the Hamm’s. Some families involve children, and some don’t. Both spouses could work, or perhaps just one does. Depending on your economic and family situation, below are some of the options you we may explore when considering financial stability after a divorce:
Post-Nuptial Agreement: Whether you initially created a pre-nuptial agreement or not, you and your spouse can draft a contract dividing up your property and debt in preparation for the possibility of divorce. Many couples do so when there is a significant change in financial situation after their pre-nuptial agreement or if they did not draft one in the first place.
Spousal Support: After divorce, a court may order spousal support to be paid to one party. This sometimes happens when one party does not have enough property or assets to support one self post-divorce and cannot do so through employment. These support payments can be temporary or permanent. These payments are sometimes similar to child support.
If you have questions about your divorce and the financial ambiguity involved, be sure to bring them to a divorce lawyer. By answering your questions, some you didn’t even know you had, your divorce attorney can help you get started on the right foot after your divorce. At Bardol Law Firm, LLC, I take pride in helping families figure out what is next for them after an emotional split. With responsibility weighing down on you, you need someone to help, and that’s where I come in. Contact my St. Louis, Missouri family law office today.