Financial Assessment: Your First Step in the Difficult Process of Divorce

Financial Assessment: Your First Step in the Difficult Process of Divorce
By: Denise Hummel

Whether your first step is to hire a mediator or see a financial analyst or assistant, you must take the first step of knowing your assets, your debts, and your expenses. For some people this is easier than for others. Depending on what role you played in your relationship, keeping track of the economics was either a big part of your life, or it wasn't. If it was not, the challenge will be more difficult, but by no means insurmountable.

You will first need to define what is marital property and what is separate property. As a general rule of them, anything you already owned prior to marriage (your home, if you owned it outright, car, furniture, stock, or retirement) is separate property. Anything you have ever gotten as a gift is separate and anything you have inherited in separate. As long as you can identify your separate property and it has not been enhanced or changed through marital funds, by tracing it back to its origin, you will most likely be able to keep it.

Step One: Google California Court Info and when you get to the official California Court System site, click on "selfhelp/family/divorce/step3.htm#formsprelim" and print out the last form at the bottom of the page (Schedule of Assets and Debts (Family Law). Doing so will help you organize your property by showing you when you got it and what it is worth. By law this form must be completed by both of you, so you are that much ahead of the game by compiling the information related to this form now.

The 2nd form on that page, (Income and Expense Declaration (Family Law) must also be completed. Fill in as much info about yourself as possible and anything you don't understand can be completed with a professional. This is another mandatory form that the court requires each party completes and will be necessary for many of the professionals you may need to speak to including a mediator, lawyer, or financial advisor.

What is the value of your home? The easiest way to find that out is to see what other homes in your area are selling for. A real estate agent you trust, or one recommended by us will run comparable listings (called, "comps") for you. Be aware that different real estate agents do this differently and for different purposes. After you agree on the home's value, you will be deducting what is owed to determine what your equity is.

When you come to see a mediator, lawyer, or financial advisor, bring copies of your most recent statements related to all accounts including your (and your spouse's) pensions or other retirement holdings. Contact your plan administrator to see if they can help you value this important asset. If you need further help you may contact one of our financial advisors, accountants or actuaries. If either you or your spouse has a business, using a professional to evaluate it is essential. The help of a forensic accountant is particularly vital in order to determine the value of a medical or legal practice.

Article Source: http://www.articlesbase.com/personal-finance-articles/financial-assessment-your-first-step-in-the-difficult-process-of-divorce-480138.html

About the Author: Denise Hummel. Denise Hummel is the founder and principle mediator of San Diego's Network of Divorce Professionals.