Getting Organized is the Key to a Successful Divorce

The beginning of a divorce case is usually the scariest part of the whole process. The process is so daunting to some that they actually choose to remain in an unhappy marriage because they are more worried about the time, effort, and expense of getting divorced. I get it; it is scary, but I can also tell you that you can reduce or even eliminate the fear by getting yourself organized and approaching the process step by step. In this post, I’ll describe a few initial things that you should do that will help you later. In future posts, I’ll go into detail on the other steps you should consider taking to help make your case run as smoothly as possible.

So where do you start? First, you should understand that divorces are essentially financial transactions. Think of it as the dissolution of a small company rather than the rendering of a marriage. Mr. and Mrs. Smith are going out of business. Not all divorce cases involve the custody and placement of minor children. However, every divorce case does involve the division and allocation of the parties’ financial assets and obligations.

The first thing you should do is look around, literally and figuratively. What do you own, and how do you own it? Either buy a ledger book from your local office supply store or create a spreadsheet on your computer (encrypt it so that prying eyes won’t discover it). List everything you can think of, including real estate, bank accounts, investment accounts, collectibles, antiques, jewelry, art, automobiles, boats, investment property, business property, retirement accounts, insurance policies, etc. Walk around your house, making entries in your ledger book as you go. Don’t forget furniture, tools, sporting goods, and all that stuff in your garage, closets, basement, and attic, known generally as personal property. You’ll be surprised how much you really own.

Take pictures as you list your property in the ledger or spreadsheet. Or, if your smart phone or tablet has the capability, video everything as you walk through the house. This accomplishes two things: first, it fixes in time the quality of your property. The whole process of getting divorced can take several months, even years in extreme cases. Suppose your ex destroys that couch in the rec room then claims it’s worthless? A picture showing its condition before a vengeful ex used it as a trampoline will help you convince the judge that your valuation is correct. Second, pictures add meaning to your entries. How else is the court to know that “picture over fireplace” is your prized lithograph of dogs playing poker?

List all the assets you can think of in the left column. In the next column, indicate how that asset is held. For instance, if you own your home, do you own it as tenants in common (each of you owns 50% of the property with no right of survivorship) or as joint tenants (each of you owns 50% of the property with right of survivorship)? If Aunt Millie left a valuable antique set of china to you, indicate that you own the property individually because of the inheritance.

In the next column enter the market value of the asset. If you don’t know the exact value, enter your best reasonable estimate. It’s better to underestimate the value of your assets: if you think your house is worth between $100,000.00 and $110,000.00, use the $100,000.00 number. When estimating the value of all that stuff from the basement, garage, etc., don’t use replacement value, or what you paid for it when new. I always tell people to estimate what they think people would pay if these items were auctioned off. That’s the value most property appraisers will use when valuing the marital estate once the divorce is pending. You might as well use a similar process now.

There are a few things you should keep in mind while making your list. Most states do not include property that you inherit or that someone gave to you. For instance, if Aunt Millie left her antique cuckoo clock to you, that clock is your individual property. Your soon to be ex has no claim on that clock—it’s yours!

The same basic provision applies to gifts as well, but there are some exceptions. I like to call this issue the Custody Fight Over the Engagement Ring. Some people believe that when the marriage ends, they have the right to retrieve, or at least divide, any gifts they gave their spouse. I have seen cases where the parties agree on dividing everything else, affecting several hundred thousand dollars worth of assets, but fight like starving hyenas over carrion when it comes to who gets the engagement ring. In most states, the ring not only stays with the wife, it is counted as her individual property, and is not considered part of the divisible marital estate. Just so the men reading this don’t feel too badly about this, remember that set of custom-made golf clubs she gave you are yours as well.

Philosophically I think that is the correct solution. After listening to hundreds of divorce clients, I’ve concluded that the best way to put this issue to rest is to be generous with your ex. You’re getting out of the relationship, you’re moving on with your life. Why make it any more difficult than it already is? I’m not saying you should just roll over and let your ex have whatever they want, especially if they gave that item to you in the first place.