As you prepare for the divorce process, you’re likely to have concerns about asset division. More specifically, you’re concerned about the impact of divorce on your net worth.
No two divorces are the same, so there’s no exact way of knowing how things will work out. For example, if you have a prenuptial agreement, you may be in position to save many of your assets from division.
Regardless of your circumstances, create an asset division checklist that does the following:
- Outlines your assets by category
- Makes note of the approximate value of each asset
- Signifies whether it’s a joint or separate asset
If you’re successful in doing the above, you’ll have an asset division checklist that can help you protect your legal rights as you move through the process.
Here are the four categories you can use:
- Real estate: This includes your family home, along with rental property, vacation property, commercial property and undeveloped land.
- Personal property: This is often the largest category, as it includes all of your personal possessions. Some of the most common include motor vehicles, boats, antiques, collectibles, electronics, furniture, clothing and guns.
- Financial assets: Sure to be one of the most valuable categories, this entails bank accounts, retirement accounts, educational accounts, cash, stocks and bonds, pensions and life insurance cash values.
- Business assets: Should one or both of you own a business, these assets could come into play. They often include commercial real estate, business bank accounts and any assets owned by the business.
While you’re creating your asset division checklist, make note of any debts associated with it. For example, if you own a home together, it will fit into the real estate category of the checklist. But you may also need to know how much money you owe on your mortgage, as this will impact how you approach it.
The simple creation of an asset division checklist will help you better understand your situation and how you want to proceed. The more details you can include, the better off you’ll be. The preparation you do up front is designed to help protect your legal rights in the future.