DIVISION OF ASSETS
(THIS IS STRICTLY ABOUT ASSETS, CHILDREN’S BEST INTEREST ALWAYS COME FIRST IN NEGOTIATIONS )
Create a Comprehensive List:
Strategy: Together or individually, create a detailed list of all assets and debts. Be as specific as possible (e.g., “RBC chequing account #12345,” “2018 Honda Civic VIN #XYZ”).
Why : This provides a clear starting point and ensures nothing is overlooked.
Agree on Valuation Methods:
Strategy: Discuss and agree on how you will determine the value of each asset. For bank accounts and investments, statements are usually sufficient. For real estate, you might agree on an independent appraisal. For vehicles, you can use online valuation tools. For pensions, you’ll likely need to request a valuation from the pension administrator
Why : Establishing the method upfront avoids disputes later on.
Prioritize Key Assets:
Strategy: Identify assets that are particularly important to each of you (e.g., the family home if one parent will be the primary caregiver for children, a business
one spouse operates). Try to find ways for each person to retain some of their priority assets, potentially through offsetting other assets or a buyout.
Why: Focusing on what matters most can help streamline negotiations.
Consider “In-Kind” Division:
Strategy: Where possible, divide assets directly rather than selling them. For example, one spouse keeps one bank account, and the other keeps another of roughly equal value. You might divide household contents based on who uses them more or who has a stronger attachment.
Why : This avoids the costs and complexities of selling assets and then dividing the proceeds
Offsetting Assets of Similar Value:
Strategy: If you have multiple assets of comparable value, agree to each take ownership of specific items to achieve an overall equal distribution. For example, one spouse might take the recreational property while the other keeps a larger share of the investment portfolio.
Why : This simplifies the equalization process by directly balancing assets.
Negotiate a Buyout:
Strategy: If one spouse wants to keep an asset (like the family home) that would otherwise be equally divided, they can “buy out” the other spouse’s share by compensating them with other assets or a monetary payment.
Why : This allows one person to retain a desired asset while still achieving fair equalization.
Address Debts Directly:
Strategy: Clearly agree on who will be responsible for which debts after the separation. Ideally, debts should follow the assets they are associated with (e.g., the person keeping the car takes on the car loan).
Why : This prevents future disputes about who is responsible for payments.
Document Everything Clearly:
Strategy: Once you reach an agreement on the division of assets and debts, put it in writing in a Separation Agreement. This legally binding document should clearly outline who gets what and who is responsible for which debts.
Why : A well-written agreement provides clarity and legal protection for both parties.
Be Willing to Compromise:
Strategy: Recognize that achieving a perfectly equal division of every single item might not be possible or practical. Be open to negotiation and finding solutions that are fair overall, even if one person doesn’t get everything they initially wanted.
Why (in the long run): Compromise can lead to a faster and less stressful resolution.
Seek Professional Guidance:
Strategy: Even if you aim for an amicable division, it’s highly recommended to consult with your own independent lawyer . A lawyer can explain your rights and obligations under Local law, review any proposed agreement to ensure it’s fair and legally sound, and help you navigate any complex issues.
Why (and essential): Legal advice provides clarity, protects your interests, and helps avoid potential pitfalls.
At the end of the day, what are we really talking about? Numbers. That antique clock? Sentimental value, absolutely. But does sentiment pay the bills? Does it secure your future? No. Focus on the numbers.