When you first begin the divorce process, you will likely be advised to come up with a list of issues that matter the most to you -- the ones that you are adamant about fighting for. What is on that list? For some people, their finances are at the top of their list of concerns. The way your finances are handled during your divorce could significantly impact your financial situation after the fact and for years to come.

The first step in successfully managing your finances during your divorce is taking an actual inventory of everything that you and your spouse own. This includes both physical items such as vehicles and jewelry and immaterial items, like bank accounts or retirement funds. Ensuring you have an accurate picture of your financial situation before any decisions are made is crucial. Here are a few tips to help you inventory your assets:

Make a List of Common Assets

Firstly, make a list of any assets that you and your spouse both have ownership to. This should include both physical and immaterial items that are considered marital property and subject to division during the divorce. Physical items can include things such as real estate, vehicles, artwork, or other important and/or expensive assets. Other items that you will want to include on the list are things such as bank accounts, retirement accounts, gym memberships, airline miles, or other immaterial items.

Getting a divorce brings about all kinds of issues that you must deal with, both emotionally and financially. Though the emotional side can be difficult to manage, the financial side has a lot of bearing on how your life will turn out in the future. Financial issues can be especially important for older couples who are nearing the age of retirement. Retirement accounts are assets that are usually quite valuable to both spouses, setting the stage for disagreements over how the assets will be divided. Ignoring or forgetting your retirement accounts during your divorce could spell disaster for your financial future. If you are getting a divorce, be sure to take these necessary precautions to help protect your retirement plans.

Understand What You Are Working With

Before you make any decisions, you should fully understand what type of retirement accounts you and your spouse have and the rules that govern each account. Common retirement accounts include employer-sponsored plans such as a 401(k) and individual retirement accounts such as an IRA. Each type of plan has its own rules, especially when it comes to dividing and distributing the funds.

Speaking with a financial adviser can help you figure out how you should divide your plans and how you can do so while avoiding any penalties or tax repercussions. A financial adviser will also be able to help you make sure you understand your financial portfolio so you can make informed decisions.

Like many Americans, your vehicle is probably one of the most important and valuable things that you own. In today’s world, many families have multiple vehicles to get them from one place to another. In the event of a divorce, deciding who gets the vehicles can often be straightforward, but there are certain issues that should be addressed before the final decision is made. Consider these things when making decisions about how to divide your vehicles in a divorce:

• Is the vehicle separate or marital property? The first thing that you should consider when dividing your vehicles is whether the vehicles are marital or nonmarital property. If you purchased the vehicle before you were married, then it is considered nonmarital property and you keep the vehicle. If you purchased the vehicle while you were married, then the vehicle must be allocated to one of you.
• What is the market value of the vehicle? When dividing your property, it can be useful to know the monetary value of your assets. When it comes to vehicles, one vehicle might be worth more than another because of the age or features of the vehicle. This can be used as a bargaining chip for other assets to make up the difference between the two.
• Do you still owe money for the vehicle? Another consideration is whether or not you and your spouse are still paying on a loan for the vehicle. If you and your spouse cosigned on an auto loan, you are both legally responsible for paying off that loan. It is generally agreed that the spouse who keeps the vehicle is the spouse to continue paying for the vehicle.
• Who gets the vehicles? Determining who gets what vehicle can be a straightforward process if you and your spouse each have your own vehicles. If you have more than one vehicle, you can award the vehicles by value or you can come to another agreement with your spouse.

Our Skilled Elmhurst, IL Property Division Lawyers Can Help

If you are going through a divorce, you may be wondering how you should divide your marital property. This can be a long and tedious process, with vehicles just being one facet. At Weiss-Kunz & Oliver, LLC, we are here to help you fight for your rightful portion of your marital estate. Call our knowledgeable DuPage County property division attorneys today at 312-605-4041 to schedule a consultation.

Illinois is an equitable distribution state, meaning that when you get a divorce, not everything you and your spouse acquired, such as property and assets, will be divided equally.

If you and your spouse cannot come to an agreement on how to divide your property and assets and decide to take your divorce to court, the judge will consider certain marital circumstances on how to divide your property, such as:

• Income
• Employment status
• Length of the marriage
• Whether a spouse is receiving spousal support/maintenance

However, if your spouse is hiding assets from you in hopes they will not have to split it with you, things can get even more complicated.

Some people may not realize that money they put into a retirement account, like a 401(k) or IRA, during their marriage is not theirs alone. When the marriage ends in divorce, those retirement funds will likely need to be split just like every other asset and debt the couple has acquired while they were married. In order to avoid paying large fees on a retirement plan withdrawal, the couple will likely need a QDRO (qualified domestic relations order). An attorney can help walk the parties through the process, as it can get a little bit complicated.

What Is a QDRO?

A QDRO is an official decree, which must be approved by a judge, that orders one party to transfer funds from his or her retirement plan to the other divorcing party. Information that must be included in the QDRO includes the plan participant’s name and either a specific amount or percentage of the benefits that are to be paid to the other party.

The party who is receiving the funds must then receive the money as if he or she was the owner of the plan. Then the payee may use the money as needed, which will result in taxes charged to the receiver of the money, or he or she may roll it over into another plan, which makes the transaction tax-free.