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Understanding what counts as an asset

| Sep 22, 2016 | Divorce

Despite our best efforts, some relationships just don’t work out. This can be particularly painful when we have pledged to spend our life with someone. Many dreams and expectations coexist with wedding plans, and the loss of those dreams can often be very difficult emotionally.

As you move into the next chapter of your life, it’s important that you retain as much financial security as you had during your marriage. Colorado law uses the “equitable distribution” standard to divide assets acquired during a marriage. This means that property is divided fairly, but not necessarily equally.

Is an IRA an asset?

Many people are unsure what an asset is. Essentially, an asset is something that has monetary value or worth. You may have some items in your household that have sentimental value but very little financial worth (for example a very small diamond ring.) In this case, it is unlikely it will be part of the asset division, but more likely be part of property division (for example things like clothes, kitchen items, etc.)

Items, however, that could be liquidated, i.e. sold, are considered assets. Common assets include:

  • Real estate: This includes the marital home, vacation homes, rental properties, lots, etc.
  • Bank accounts: Whether singularly or jointly held, these are part of the marriage estate.
  • Burial plots: Many burial plots are worth considerable money.
  • Life insurance policies: Some policies accrue monetary value. These are part of the marital estate if purchased during the marriage.
  • Retirement accounts: Both traditional and Roth IRA’s, 401K plans, pensions, etc.
  • Jewelry: If you own jewelry that has significant value, and it was acquired during the marriage
  • Stocks and Bonds: If purchased during the marriage

Are there more?

This list is not exhaustive.  Each couple has circumstances that make their case unique. During the pendency of your divorce, each attorney will work with the clients to arrive at a fair and just settlement. Generally, a couple can come to an agreement on asset division. When that is not possible, the court will intervene and make a determination regarding asset distribution.