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Editor’s note: This is the first in a series of articles on how to make sound financial decisions for divorcing couples.
Divorce is an emotional process, but divorcing couples need to let go of emotions when talking about division of property, says University of Missouri Extension family financial specialist Vivian Mason.
While that is a difficult task, it is essential to long-term post-divorce financial security, Mason says.
“It’s no easy process,” she says.
Money is the No. 1 reason married couples fight, and it will likely be one of the most contentious issues in a divorce.
Documentation and organization will help couples reach a fair and equitable settlement.
“Equal is not always equitable,” Mason says. “There is no magic formula to come up with a division that is right down the middle. There’s a great deal of negotiation.”
It is important to not hide documents and information, she said. “It is a terrible plan to play games. Both parties must be completely open and honest. Omitting details is a mistake.”
It might not be possible to immediately divide some assets, such as the sale of a home or distribution of retirement plans, but conditions for future division need to be set.
Couples should provide the following items to their attorneys for the judge to make a determination of property division:
• Bank statements.
• Income tax returns for past five years and wage verification for past eight years.
• Net worth statement.
• Household plans.
• Deeds to real estate.
• Mortgage papers.
• Bills of living expense, including child care, if applicable.
• Insurance policies.
• Savings documents.
• Pension/retirement documents.
• Documentation of debts.
• Inheritance documents, if applicable.
• Proof of any other income, including business income.
For more information on financial planning and divorce, go to www.extension.missouri.edu/callaway/divorce.aspx.
Next: Parents who divorce face critical financial decisions.