The prospect of splitting up your assets during a divorce is never easy. Dividing up investment portfolios can be even more challenging than dividing up sentimental items, cars and a home. There are many reasons why this is often a complicated process.
One of the reasons why dividing investment accounts can be complex is that there’s no one way to do it. It varies depending on the financial instrument involved.
If you have a joint brokerage account with your spouse, for example, then you may have to supply the investment firm that holds that account with a written request to dissolve it and create two single ones for each of you. You two will need to detail how you wish to divide it.
In some cases, one or both of you may elect to relocate your assets to another investment firm or liquidate them. You may have to pay fees, taxes and other financial penalties for doing so, though. There may also be some instances in which not all investment assets, such as insurance policies or proprietary funds, may be easily transferred.
Many divorcing spouses rush to split up their joint investment accounts. They often do this hoping that their soon-to-be-ex won’t make withdrawals or investment choices that go against their preferences.
Many divorcing couples don’t realize that they can ask their broker or firm to freeze their investment account so that neither spouse can make trades or withdrawals until the two parties mutually agree on how to split up their assets. Working out an agreement about how to divide these up may take time, though.
Divorcing spouses may have to consult with their Florida investment adviser and accountant in addition to their divorce attorney to discuss the implications of making one financial choice versus another. Your attorney can work to make sure that you receive your fair share of these and other assets.