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Extension > Family > Parents Forever™ > For Families > Resources for Families > Taking Care of Yourself > The Financial Side of Family Transition > Assets: Savings and Investments

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The Financial Side of Family Transition

calculator, savings papers

Assets: Savings and Investments

Janene Baedke, Extension Educator; Sharon M. Danes and Jean W. Bauer, Extension Specialists and Professors — Family Social Science; Kathleen Lovett, Extension Educator; Kathryn D. Retting, Professor — Family Social Science; and Patricia Stumme, Extension Educator

2011

It is important that families have the assets that they need to meet the needs of their family. Determining the right combination of assets that will be best for your family depends on several factors, such as your future plans for yourself, education, needs of your children, your age and ages of your children, risk tolerance, income needs, and investment experience. Assets are valued as of the separation date.

During a family transition like a divorce or separation, it is critical that you assess the ownership of your financial assets, their fair market value, and their tax basis. Fair market value is the price at which an item could be sold. For divorce purposes, it also means the amount the investment is worth before any debt is subtracted. Tax basis (taxable value) is the original purchase price plus improvements minus any tax benefits. Because tax consequences are so fundamental to the retention of an asset, you should know the tax basis before you divide your assets, not after.

Tracking Assets

The Tracking Savings and Investments (Assets) (291 K PDF) form can help you get started with tracking your assets. If you're unsure where to locate the information needed for the form, your federal income tax returns for the past few years are excellent sources of information. You can learn about ownership and value of financial instruments from completed tax form 1040 and additional schedules (B and D). In addition to income tax returns, the following will be helpful in tracking assets:

Making Decisions About Assets

What to do with your assets is another important decision during a family transition. Here are some things to consider when making decisions about financial assets:

You may realize that some assets, like investments, need to be divided. Here are some questions to ask yourself as you’re preparing to split investments:

For a description of the chief advantages of various savings and investment types, consult the University of Minnesota Extension publication, Planning Ahead for Retirement. This publication also describes nine decision criteria to use in your investment decisions. You may also be interested in the online course Invest NOW: Money in Retirement.

Sources

Cooperative Extension System. (2008). Investing for your future.

Danes, S. M. (2009). Planning ahead for retirement. St. Paul, MN: University of Minnesota Extension.

Related Resources

Planning Ahead for Retirement — Guides you in developing a retirement plan that takes into account the financial, emotional, and social aspects of your life.

Invest NOW: Money in Retirement — Online course that will give you the basic education you need to start investing for your future.

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