Get organized in preparation for divorce
Ohio couples who are headed for divorce may be able to reduce stress by getting organized and prepared. To begin the process, both spouses should take an inventory of their assets and liabilities including sources of income, assets, living expenses and debt. A financial professional can help spouses organize and gather information and assemble it into a financial affidavit for use by an attorney or mediator to facilitate the process of property division.
The most obvious source of income is earnings from self-employment or a job. There are other possible sources of income to consider such as annuities or investment income. Some common assets that can be listed are personal property, collectibles, employee benefits, real estate, non-retirement investment accounts, money market accounts, bank accounts and cash. Tax returns from prior years are a great resource for information regarding assets. However, some assets might not show up on a tax return such as life insurance policies and annuities.
In order to anticipate future expenses, it is a good idea to get a picture of each spouse’s current spending patterns. One important step is to conduct a careful review of recent bank statements, making a note of any annual expenses that might otherwise be overlooked. Liabilities will include both individual and joint obligations, including common items like credit card debt, student loans, auto loans and mortgages.
Creating a comprehensive financial outline will go a long way toward creating an equitable division of a couple’s assets. A divorce lawyer may use a financial affidavit plus a client’s own financial records to help negotiate a comprehensive settlement agreement.
Source: CNBC, “Getting divorced? Get organized first“, Valerie Adelman, March 09, 2014