Acclaimed actor and producer Reese Witherspoon has announced her divorce from investor and entrepreneur Jim Toth, her husband of almost 12 years. The couple has been one of Hollywood’s power couples for over a decade, as Toth’s business acumen and connections and Witherspoon’s media acclaim place them firmly among the wealthiest in the field.
In fact, the couple has been so successful that they will be splitting assets valued at more than $430 million during their divorce. Witherspoon has earned millions from her movies alone, while Toth has made similar amounts through his role as a founder of businesses like Quibi and Draper James. In addition, the pair have routinely made millions on their property investments over the years.
However, these are just drops in the bucket compared to the ultimate source of their $430 million net worth. In 2016, Witherspoon founded the production company Hello Sunshine with her husband and several others. The couple sold their majority stake in the company in 2021 in a deal worth $900 million overall, sending their combined net worth skyrocketing.
While most divorces involving multi-multi-millionaires quickly become complicated, Witherspoon and Toth have done everything right. According to sources close to the couple, they have no hard feelings. More importantly, “There’s no drama. These decisions are so difficult when there is so much friendship and love there.”
The amicable nature of their split has allowed Toth and Witherspoon to quietly and privately address many aspects of their finances that would complicate their divorce. It appears they have been liquidating some of their most complex assets over the past year or two, converting them into liquidity that can be more easily divided.
Witherspoon’s split is an excellent example of the right way to handle high-net-worth divorces. Here’s what makes these types of splits different and what you can learn from Reese Witherspoon’s example.
How High-Net-Worth Divorces Are Different
A high-net-worth divorce doesn’t have an official definition under the law. Instead, it’s a term of art used to describe divorces that are typically more complex because of the significant amount of assets involved. As a baseline, these splits involve more than one million dollars in property.
This property adds a layer of financial and legal complexity to ending a marriage. Under California’s community property laws, a couple shares joint ownership over all property they accrue while married. Furthermore, they must divide the value of their marital assets equally, regardless of who acquired them. The greater the couple’s net worth, the more property there is to separate, and the more complicated their divorce could become.
That’s why high-value splits require a different approach than others. It takes extra care and knowledge to ensure the additional property is fairly valued and split between spouses. Without a considered approach, these complications can cause divorces to drag on for months or even years longer than necessary.
What to Learn From Witherspoon’s Divorce
Despite the possible complications, Reese Witherspoon and Jim Toth have kept their split moving forward. Here’s what you can learn from their choices to make your own high-net-worth divorce run smoothly.
Look for Opportunities to Simplify Your Assets
While it is impossible to know for sure, the sale of Hello Sunshine may have been the couple’s first step toward simplifying their asset division in a high-value divorce. If so, it was an excellent decision. Intangible assets, such as businesses and intellectual property, are some of the most difficult things to divide fairly. By selling the business but retaining leadership roles, the couple maintains control over its direction while converting their equity into liquid funds that can be split down the middle.
You can do the same with intangible assets of your own. If you do not have a strong emotional attachment to them, you can sell them before or during your divorce and divide the proceeds. This can significantly reduce the difficulty of finding a fair split.
Collaborate With Your Spouse
Witherspoon and Toth are still amicable and collaborating during their divorce. That collaboration makes all the difference in how smoothly the process will go. For example, the pair seems to be calmly working together to divide their assets rather than messily fighting about spousal support or child custody.
It’s worthwhile to attempt the same with your own spouse. Collaborating with them can help you reach a settlement that satisfies both of you. It also helps avoid conflicts that could drag out the process unnecessarily.
Keep Emotions Out of Your Decisions
While divorce can be emotional, the couple has publicly kept their cool. Neither person appears to be allowing their emotions to rule their decisions about assets, custody of their son, or anything else.
This is one of the best things you can do for yourself during your own divorce. Regardless of how your spouse may act, you should keep your emotions from making your decisions. Keeping a level head is key to preventing stressful court battles about your split.
Pursue Private Options
It appears likely that the couple will manage their divorce through California’s private judge system. This will help them keep the details of their split out of the public eye. It will allow them to quickly wrap up the legal aspects of ending their marriage without scheduling drawn-out hearings. Anyone eligible to get divorced in California can do the same to simplify the proceedings.
Follow in Reese Witherspoon’s Footprints During Your Divorce
Getting divorced is emotionally hard, but even high-value splits can be financially simplified. You can take a page out of Reese Witherspoon’s book and make yours that much easier by working with an experienced high-net-worth divorce attorney like the team at Kaspar & Lugay, LLP. Schedule your consultation today to discover how our team can help you end your marriage efficiently and privately, no matter how many assets you may have.