What is a Statement of Net Worth?
When divorcing, a Statement of Net Worth is that annoying financial form your attorney/mediator sticks in front of you and says, “Fill it out!”
You look at it, start sweating, and think, “Oh no! Where do I start?”
I find that most clients hate filling out their financial statements. These are the forms required of clients in matrimonial cases in New York to disclose their income and assets.
Filling them out can be time-consuming and tedious. But, they must be done.
Sometimes clients fill them out to record their marital lifestyle. Sometimes they are used to represent what an individual will need going forward with or without children in the home.
The good news is a Statement of Net Worth will acquaint you with what you have been spending. Many clients also use this vehicle to get a handle on their budget and spending habits which may not have been on their radar.
Here is a small sampling of what is needed in the Statement of Net Worth:
1. Family Information:
Names, birth dates, family composition, occupations, employment.
2. Expenses:
Mortgages, rent, equity loans, utilities, phones, internet, food, clothing, dry cleaning, life insurance, health insurance, dental, medical, pharmaceutical, automobiles, education, gardening, vacations & domestic help, just to name a few.
- Income:
Earnings, investment income, social security benefits, disability, veteran’s benefits, etc.
- Assets:
Cash, savings accounts, checking accounts, stocks, bonds, and real estate, followed by retirement accounts like pensions, 401 (k)s, profit sharing plans and deferred compensation plans, cars and boats, and jewelry, art, antiques and household furnishings.
- Debts:
Student loans, equity loans, credit card debts.
Once you have completed your Statement of Net Worth, you have a picture of how much it took to maintain your marriage financially; it will be a blueprint of the expenses to be met once divorced, and it will disclose what will be considered in equitable distribution and for negotiation.
Ask your lawyer/mediator what is needed at each stage of your case. Sometimes it is helpful to include only necessities. Sometimes your lawyer may advise you to include as many luxury items as you can (such as vacations, massages, and household help). Is the document being used in Court or in negotiations between lawyers? Remember you are swearing to the truth of your statements under oath.
Don’t just take a stab in the dark at your Statement of Net Worth. Make sure to have a thorough discussion with your lawyer about how to fill out your financial forms so that it will best represent the facts in your case.
Would you like to see what a Statement of Net Worth looks like?
Email me to receive a free sample so you can get an idea of what you will be expected to share about your lifestyle and your finances. You can send your request to lb@divorcelawyerny.com.
For those of you considering divorce, I am currently offering a free consultation. I will be happy to answer any and all of your questions!
For over 35 years as a divorce attorney and mediator I have been guiding spouses successfully to find the right path to divorce. If you need help with your divorce, call me today!
Our FREE 1 HOUR CONSULTATIONS are veryinformative and conveniently conducted virtually to reduce risk!
I look forward to speaking with you.
Continue to Stay Healthy & Safe!
Warm regards,
Lois
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