Chapter 6: How Do We Divide our Property and Debts
Need help determining accurate values for your assets and debts as part of the equalization process?
There are two important factors to remember:
- Ensure you have the correct dates for your documentation (date of separation and date of marriage).
- Ensure you use the fair market value (not the retail price or replacement cost).
Here are 10 other ways to place value to your assets and determine debts:
- For bank balances, RRSP’s, loans (lines of credit, car loans, mortgages) and credit card balances, obtain copies of bank statements, RRSP statements, loan statements and credit card statements that contain data for the date of separation and the date of marriage.
- To determine the value of an automobile, an appraisal can be done at a dealership. You can also go to the library and look up the “black book value” of the car. Make sure you know the year, make, model and mileage.
- For household contents, determine the fair market value of each item. This is the value of the item if you were to purchase it at a garage sale. You can estimate the value on your own but with significant disputes, we can arrange for an auctioneer to come to your home and complete and appraisal for you.
- A home appraisal will determine the fair market value of the home. An appraisal can be done by a real estate agent or by a certified appraiser. The agent will be less expensive than the certified appraiser but will be less persuasive.
- The value of a privately owned business is trickier. Often, privately owned businesses are valued by a Certified Business Valuator. The cost of such appraisals can range from $7,000 to $12,000 or more depending on the complexity of the business.
- The value of publicly traded stocks and bonds can be determined from the value of the stock at the close of the day on the relevant dates.
- Pensions are usually valued by the pension administrator. There are many complicated forms to complete in order to get the pension appraised. If you work for a company that is registered federally like Air Canada or CP Rail, you will need to get an actuary to appraise your pension.
- Stock options are very complex to appraise. But we have connections with experts in Toronto who can complete an appraisal.
- Cash surrender value is the value of your whole life insurance policy. Your insurance agent can provide a letter stating the cash surrender value.
- Getting your divorce finalized? Priceless.
