Getting Your Financial House in Order
What Documents Should You Gather to Prepare for Separation or Divorce?
By Nancy Grace, WAKE FAMILY LAW GROUP
One of the most important things you can do if you are contemplating separation or divorce is to gather financial documents and information. Although this process can seem like an overwhelming task, it will save you time, trouble, and, more importantly, legal expenses in the long run. Follow this simple guide to what documents you should gather.
Assets and Debts
“Equitable distribution” is the process for the division of marital property in divorce. Before you can consider how to equitably divide marital property, you need to know what you have and what it is worth. Start by making a comprehensive list, with account numbers, of all assets and debts that you and/or your spouse currently have. Gather and copy the account statements as of the date of separation (or the current statements if you are not yet separated) for all financial assets you or your spouse own together or individually, including bank accounts, retirement benefits, and other investments, such as stock. For vehicles, go online to nada.com or kbb.com and print off the value for each vehicle. If you have a recent appraisal on your house or other real estate you own, make a copy of that. For debts, copy the date of separation statements showing the balance of all credit cards, vehicle loans, mortgage and/or home equity loans, lines of credit, and personal loans. For any business you or your spouse own, make a copy of the business tax returns, profit and loss statements, and income statements.
Income and Expenses
The issues of child support and spousal support are often an immediate concern when spouses separate. Child support is typically determined by a formula under the NC Child Support Guidelines. The data that goes into the calculation includes the monthly gross income of both parents, the average monthly cost of work-related child care, and health insurance costs for the child(ren). Gather and copy the documents which reflect this information. Alimony is not determined by a formula. Instead, the analysis considers the dependent spouse’s shortfall in meeting his/her reasonable needs after applying his/her own income, and the supporting spouse’s ability to pay after that spouse pays his/her reasonable expenses. To assist in determining an appropriate amount of alimony, you should gather current income information for both spouses, such as recent pay stubs and the most recent year’s tax returns with all schedules and attachments. You will also need a summary of each party’s reasonable average monthly expenses.
While these may not be all of the documents that your attorney asks you to provide, assembling these documents in advance will save you time and money and provide the starting tools that your attorney will need to assist you.