Dividing Assets: What To Do in a Divorce

Updated September 21, 2023
11 min read
Dividing Assets: What To Do in a Divorce


Initiating a divorce ushers in myriad complexities, a predominant one being the division of assets. This process is incredibly tricky, turning into an emotional tug of war as you and your former partner attempt to reach a settlement about who gets what. Dividing assets in divorce entails moving beyond the realm of emotions and firmly understanding the specifics of your shared assets and financial situation.

The laws governing the division of assets during a divorce, however, are not universal and can vary significantly from one state to another. To stay on top of things, it's essential that you fully understand your rights according to the laws applicable in your specific state or country. If you're wondering what all this entails or are looking for answers to specific questions, continue reading this comprehensive article that delves deep into the intricate process of dividing assets in divorce.

What Are the Different Types of Divorces?

In navigating the difficult path of dividing assets in divorce, understanding the different types of divorces becomes imperative. Typically, divorces can be primarily categorized as contested and uncontested divorces. The differentiation between these two fundamentally shapes the process of asset division.

A contested divorce potentially signifies a tumultuous journey. This can be particularly true concerning dividing assets in divorce. Parties in this type of divorce often find themselves at loggerheads over the fair distribution of assets. The disagreements can stem from differences in perceived asset values or unresolved emotional attachments to certain properties. This tussle involving contested divorces makes the process of dividing assets in divorce more prolonged and emotionally draining.

In stark contrast, an uncontested divorce is characterized by mutual agreement on all terms. This extends to dividing assets in divorce. A consensus prevails on the distribution of assets, streamlining the process. Nonetheless, it's not a walk in the park — it requires careful communication and an in-depth understanding of properties. Transforming conflict into agreement simplifies the process of dividing assets in divorce, making it a less harrowing experience.

Essentially, these are the critical differences:

Contested divorce:
  • Characterized by disagreement over issues, particularly asset division.
  • Generally, it involves lengthy, emotionally draining, and potentially costly procedures.
Uncontested divorce:
  • Characterized by agreement on all terms, including over-dividing assets in divorce.
  • The process requires clear communication but tends to be smoother and less convoluted.

Regardless of the type of divorce involved, access to the right resources can make a huge difference. Consider other personal templates and documents available on Lawrina, designed to assist you in navigating these personal issues more smoothly. Armed with the right resources and computation, you increase your chances of a fair outcome in the process of divorce and dividing assets.

What Kind of Property Do You Own?

In the labyrinthine process of dividing assets in divorce, the first significant step is understanding what exactly these "assets" are. The types of property that can be divided during a divorce extend far beyond bricks and mortar. These include both tangible and intangible assets.

  • Tangible assets are things you can physically touch, and they play a crucial role in dividing assets divorce. They include houses, cars, appliances, furniture, jewelry, and even your beloved pet! Essentially, anything you can put your hands on falls into this category and must be considered during the division process.

  • Intangible assets, while not physically touchable, are nonetheless real and valuable, and they're part of the process we call dividing assets divorce. These are assets like stocks, bonds, licenses, patents, copyrights, retirement savings, or insurance policies. They might not be as evident as the dining table you dine at, but they play a hefty role in the divorce proceedings.

Understanding the extent of your assets is a vital step in managing the division process in divorce. Be thorough. You might be surprised at how many assets you have that only crossed your mind once the process of dividing assets in divorce commenced.

How Do Local Laws Influence Assets and Debts Are Divided in Divorce?

In the United States, the law governing dividing assets in divorce varies significantly from state to state. This variance substantially influences how your property and debts are divided during a divorce. Roughly, these laws swing between two pendulums — "Community Property" laws and "Equitable Distribution" laws.

Under "Community Property" laws, which are the rule in states like California and Texas, all marital assets and debts are split equally in half upon divorce. Imagine having a cake and cutting it straight down the middle — this is essentially how community property states handle dividing assets in divorce. However, it's important to underscore that only marital assets, meaning those acquired during the marriage, fall under this rule. Separate property, or assets that each spouse brought into the marriage, generally remain separate and aren't subject to division.

On the other hand, "Equitable Distribution" states, which include states like New York and Florida, approach dividing assets in divorce differently. Rather than automatically splitting assets 50/50, courts in these states divide assets based on what is "equitable" or "fair," which isn't necessarily equal. Factors considered include each spouse's financial situation, their age and health, their earning abilities, and the length of the marriage, among others.

Given the complexities of these laws and their variances across states, individuals heading for divorce proceedings should think about soliciting advice and representation from lawyers who work with personal issues. These professionals have the requisite knowledge and experience to protect your legal rights and interests when dividing assets in divorce.

How To Split Assets in Divorce?

Dividing assets in divorce can be a daunting endeavor, but following a systematic process can help ensure that the division is fair and equitable. Here's a simplified breakdown of the steps involved when dividing assets:

  1. Identification of assets: Pivotal in dividing assets in divorce is first identifying all the assets that you and your spouse own collectively and individually. These assets include but are not limited to real estate, vehicles, investments, retirement accounts, businesses, and valuable personal items.

  2. Classification of assets: Once all assets are identified, the next step in divorce dividing assets is classifying these assets as either marital or separate. Marital assets are typically all properties acquired during the marriage, regardless of whose name it is in. Conversely, separate assets are those that one party owned before marriage or acquired during the marriage via inheritance or as a personal gift.

  3. Valuation of assets: For a fair division, the value of each marital asset must be determined. This part of dividing assets in divorce may call for professional appraisers' services, particularly for more significant assets like houses, vehicles, and business interests.

  4. Equitable distribution of assets: Based on the value of the assets, the next step in divorce dividing assets is deciding how to distribute them equitably. Distribution can occur through mutual agreement, mediation, or court determination. It's important to note that "equitable" does not necessarily mean "equal"; instead, it implies what is fair and just considering various factors.

  5. Finalizing the division: Once a decision has been made on distribution, the process of dividing assets in divorce culminates in making this division legal and binding, usually in the form of a court order or legal agreement.

Going through this process can be exhausting and emotionally draining. Therefore, it's beneficial to seek the services of legal professionals and financial advisors who specialize in these matters to ensure your rights and interests are protected while dividing assets in divorce.

Is It Possible To Divorce without Dividing Assets?

In the world of divorce dividing assets, is there a possibility of walking away without touching them? Yes, couples may agree not to divide their assets in rare circumstances. This approach requires mutual trust and is more common in marriages without significant assets or in situations where one person has significantly more assets than the other. Despite these exceptions, the concept of a divorce without dividing assets remains a somewhat exotic idea in most cases.

Dividing up property yourselves

Going through a divorce can be a challenging time. However, if you and your spouse can work together to make decisions, dividing assets in divorce can be done efficiently and adequately represent the interests of both parties. One of the first steps is to compile an exhaustive inventory of all shared and individual assets. This should include everything from physical properties like houses and cars to financial assets, retirement accounts, and personal valuables. Assigning a value to these assets is also important — you may need assistance from professional appraisers to ensure this is done accurately.

Once all assets are identified and valued, you can then begin the negotiation process. This is perhaps the most critical aspect of dividing assets in divorce. You'll want to work towards an equitable split, which doesn't necessarily mean an equal 50/50 divide. Instead, factors like the length of the marriage, each party's earning potential, and the role each partner played in acquiring the assets, among others, need to be considered. 

Once this is agreed upon, your decisions should be documented and formalized in a legally binding divorce settlement agreement. Doing so will help protect each party's rights and resolve future disputes regarding the division of assets. It's important to bear in mind that dividing assets in divorce is a process that requires open communication, patience, and compromise. 

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In conclusion, dividing assets in divorce can be a complex and emotionally charged task. It frequently involves high-stakes negotiations, hard decisions, and necessary compromises. Despite the inherent challenges, it is highly possible to navigate these turbulent waters and arrive at a satisfactory outcome with the appropriate guidance and a balanced, conscientious approach. Understanding the specific divorce type at hand, the intricacies of state laws and how they govern asset division, and knowing what assets are involved is fundamental.

However, it's crucial to recognize that dividing assets in divorce doesn't always have to happen in a courtroom. Couples willing to communicate and compromise may find that they can achieve satisfactory divisions independently, armed with a well-structured divorce settlement agreement. Knowledge is indeed power, and in the case of dividing assets, it can be the key to unlocking a far less strenuous divorce process. While you may start with a collection of shared assets, the end goal is to protect your interests and ensure a secure financial future in your separate lives.

Frequently Asked Questions

How are debts divided in divorce?

Just like assets, debts are also subject to division in a divorce. The process of dividing debts in divorce follows similar principles to dividing assets in divorce. Generally, debts that were incurred during the marriage are considered marital debt and are divided between both parties. This could include things like mortgages, credit card debts, or car loans.


However, the specific laws governing the division will vary based on your state's law. Some states follow "community property" rules, meaning all marital debt is split equally in half, while others follow "equitable distribution" laws, meaning the debt is divided in a manner that is fair but not necessarily equal. It's crucial to keep these regulations in mind when dividing debts in divorce.


Can my spouse hide assets in a divorce?

While it is illegal, unfortunately, it is not uncommon for a spouse to attempt to conceal assets during a divorce. This is often done with the intention to reduce the amount that would be subject to dividing assets in divorce. Assets can be hidden in various ways, such as transferring money to a secret account or transferring ownership of assets to a third party.


If you suspect your spouse is hiding assets, it's essential to take action. A financial investigation may be required, and legal assistance can be invaluable. The discovery process during divorce proceedings can also help uncover hidden assets. This includes disclosures, interrogatory questions, and depositions, amongst other things. 


What if we can’t agree on dividing assets in divorce?

Disagreements about asset division can complicate and prolong the divorce process. But if you find that you and your spouse can't agree on dividing assets in divorce, there are options available to help resolve this. Mediation is often a beneficial first step, where a neutral third-party mediator can help facilitate discussions and potentially reach agreements.


If mediation isn't effective or is not a viable option, you may need to turn the decision over to the courts. A judge will then make the decision regarding dividing assets in divorce based on your state's specific laws and factors, such as each party's financial situation, their contribution to the wealth acquired during the marriage, and their future financial needs.