Once divorce papers are served, separating spouses must prepare themselves to make a variety of decisions to end their marriage. As many Pennsylvanians know, property division can be one of the most challenging of these issues. If significant assets are involved, the case can become contentious, especially if the spouses are not willing to cooperate. For those spouses who were not involved with financial decisions during the marriage - an estimated 25 percent of all women, for example - property division can be especially difficult. By improving their financial literacy, however, they have a better chance of taking their fair share of properties and assets.
Learning about income, expenses, assets and liabilities can help a spouse determine how much the couple has and what it owes. When it comes to income, a spouse should consider more than just salaries; also factor in the value of compensation packages, commissions, bonuses, trust income, inheritance and any investments the couple has. A spouse should then work to determine how exactly the couple has spent its income: for example, on utilities, tuition, entertainment, groceries, magazine subscriptions and so on.
The next step is to understand the couple's assets and their worth. Establish the value of all bank accounts, both individual and joint. Remember to include tangible assets such as houses, cars, boats, household furnishings, art, real estate and jewelry.
Finally, a spouse should determine the couple's exact and complete liabilities. This generally means debt and includes credit card debt; business, student and personal loans; and mortgages. These debts are often divided in divorce.
Once divorcing spouses have a clear picture of what their actual finances are, they can seek legal advice from a knowledgeable professional who can help them divide their property and assets with the least financial impact as they move toward a new future.
Source: Forbes.com, "The most important New Year's resolution a divorcing woman can make," Jeff Landers, Dec. 17, 2014