“The stress of this divorce is killing me—I can’t even think straight. How in the world do I get ready to talk about the money at our next session? I don’t even know what financial documents I need in my divorce.”
Many struggle to wrap their minds around divorce, but they know one thing. Divorce affects money.
Couples must decide who gets which assets, who will pay which bills, and how ongoing financial arrangements work. Yet, between auto-pay and credit cards, many don’t even know where their money is going.
Gathering essential financial documents proves crucial. Knowledge brings both preparation and increased confidence for discussions.
What financial documents do I need?
To fully understand your financial picture, along with possible options for settlement, make sure you gather these:
Housing—
- An appraisal of the value of your home and any other real property (vacation home, cabin, timeshare) you own–separately or together. Even if the property is only in one person’s name, it is likely marital property belonging to both. Usually, you can call your realtor and request a “curbside” appraisal. The realtor uses sales of comparable houses in your area to give an estimated value of the home—generally for free.
Other Assets—
- Account statements for any checking, savings, money market, cryptocurrency, or other accounts. Generally, you want a minimum of 3 months of statements to verify amounts in the accounts and to inform both of spending patterns and automatic withdrawals. (Verifying automatic withdrawals is critical if the account will be closed. You will want to transfer those payments to other accounts before closing so loan payments don’t bounce!) If there are concerns about spending patterns, 12 months of statements may be needed.
- Investment statements for brokerage accounts, annuities, or any other investments. You will want the most recent full statement.
- Retirement statements for IRAs, 401(k)s, retirement healthcare accounts, and pensions. You want the full statement showing the types of funds in the retirement plan as different types of funds may work differently—with significant impact on discussions in divorce.
- Trust documents if you are a current beneficiary under a trust
- Loan documents if you have loaned money to others
- Court documents for any lawsuit where you might receive money in a judgment
- Valuation for all vehicles cars, campers, motorcycles, three wheelers, boats, livestock trailers, etc. Kelley Blue Book offers reliable information. Be sure to consistently use either private sale or trade-in value between all vehicles.
- Documents regarding ownership interest in a business which detail the ownership interest, type of business, and your role in the business. In the divorce, a valuation of the business interest will need to be obtained. It is helpful to discuss the best path for obtaining a valuation in the mediation. Gathering the basic information upfront will help guide that discussion.
- Paystub to corroborate income; taxes; and payments deducted for retirement, health insurance, HSAs, life insurance, union dues, etc.
Liabilities—
- Mortgage statement detailing terms, amounts still owed, and type of mortgage. Be sure to gather these for any Home Equity Line of Credit or second mortgage as well.
- Loan statements for vehicle loans, student loans, loans from family, loans against retirement accounts
- Credit Card statements for every open credit card, even if you do not carry a balance or haven’t used the card in years
- Court documents for any case where you are being sued and may owe a judgment
Other Documents–
Tax Returns for at least the last three years
Credit Report to ensure all liabilities are addressed in the agreement.
How will gathering all these financial documents help?
Documents define the reality of your financial picture. While this can initially be overwhelming, knowledge reduces stress.
Your mediator will walk you through the documents to help you fully understand your financial challenges and your financial resources to meet those challenges. Instead of anxiously wondering what you have, you know.
Also, sometimes one person feels their spouse knows far more about the finances. Other times both feel in the dark. The compilation of documents informs both and equalizes the “financial power” between you.
Finally, the concrete numbers define what is possible. This enables you to focus on the viable options for settlement—often making the divorce process go more smoothly and cost far less. You keep more of your money for your future needs.
Vague fears of financial disaster overwhelm. Concrete information brings clarity and a path forward.
If you would like more information about navigating finances in divorce, please contact Resolution Mediation by clicking HERE or calling 317-793-0825. We look forward to serving you. As always, the above is for information only. Seek a divorce professional for guidance in your personal situation.
