Assets and Debts — What You Own and What You Owe

These lists may be used when you are figuring out the terms of a divorce or figuring out how to manage the family’s finances while staying together.

Assets include:

   •  Real estate

   •  Bank accounts

   •  Stocks and Bonds (brokerage accounts)

   •  Pensions

   •  Retirement accounts

   •  Cars, boats, and other vehicles

   •  Jewelry

   •  Household items

   •  Furniture, computers, and phones

Debts include:

   •  Mortgages

   •  Credit card accounts

   •  Student loans

   •  Vehicle loans

   •  Unsecured loans

   •  Loans from your 401K, IRA, or other retirement accounts

The lists above are sufficient for many people but do not include all possible types of assets and debts. If you already have an accountant or a financial advisor, you may want to ask that person to help you make sure that your lists of assets and debts are complete.

To make well-informed decisions, you may need documents that verify the value and ownership (just one spouse, or shared ownership) of your assets. If divorcing, you may need to know their value when you acquired them, when you married, and when you separated. The same applies to your debts.

People with few assets and few debts often figure this out on their own. People with more wealth and more complex financial situations sometimes ask professionals to help them understand their finances.

To plan a divorce, you will also need to figure out which assets are marital property and which are separate property, owned by just one of you. Similarly, you will need to figure out or decide which debts belong to the two of you as marital debts and which debts are just one spouse’s responsibility.

In Virginia, almost all property either of you acquired during your marriage is presumed to be jointly owned. This includes retirement accounts. You are expected to divide marital assets equitably after you pay any debts secured by them. “Equitable” means fair, considering all relevant factors, but not necessarily equal.

As a general rule, property you owned prior to the marriage, property you inherited, and property you received as a gift to you as an individual are all your separate property. Exceptions occur when you have complicated the picture by mixing separate property with marital property. Separate property, which does not have to be shared with your spouse, also includes income you earned after you separated.

Many people are able to figure out or decide on fair enough ways to divide their assets and debts. If you have a complicated asset, such as the value of a business that one spouse built up while the other spouse was a stay-at-home parent, you may want to talk with attorneys. Similarly, if you have commingled separate property and marital property and are having trouble agreeing on a fair way to divide the resulting assets, you may want to seek legal advice. Even in complicated situations, however, we have seen many couples create plans for dividing assets and debts that both parties thought were equitable.

Some people want input from lawyers and financial analysts before making these decisions. Many people are comfortable deciding how to divide assets and debts on their own or with help from a mediator.

– – –

This article contains excerpts from The Guide to Low-Cost Divorce in Virginia, by Virginia Colin and Rebecca Martin.

If conflicts or changes in your family might make working with a family mediator a good idea, call 571-431-9159 for a free consultation, or contact our professional family mediators at info@cfmg-va.com. 

Mediation services are available in Springfield, Fairfax, Alexandria and elsewhere in northern Virginia.