Do you know your precise net worth? Probably not. After completing a financial affidavit, though, you will know how much you own, how much you owe, and how much you are worth. For good or bad, your soon-to-be-ex-wife will know all that, too. A financial affidavit is a legal tool used during discovery so the court overseeing your divorce has a good picture of the assets to be divided.
What is a Financial Affidavit For?
Though the document may be called different things in different Virginia jurisdictions, a financial affidavit is a necessary part of a divorce in Virginia. It is as much a part of the paperwork trail as the VS-4 Form, proclaiming your divorce. Your attorney, the presiding judge, your wife, your wife’s attorney all need to know where you stand financially, for good or bad.
A financial affidavit is a financial disclosure form that serves as a statement of net worth — worry less about the name and more about the details that go into it, since it lays bare your entire financial landscape for all to see.
The financial affidavit declares the kind of life you have been living, economically. If you are middle class, it will show your struggles to keep up with routine bills. If you are a high asset individual, it will show how good a shepherd you have been of your wealth. If you are economically disadvantaged, it may underscore some of the reasons for your divorce.
An affidavit is a document sworn to under oath. A financial affidavit is such a formal document related strictly to your financial situation:
- Income and sources
- Expenses — Monthly, semiannual and annual expenses, whether for mortgage, utilities, car or yacht payments, life insurance, country club dues, or bus fare
- Debts — Unsecured and secured debt
- Liquid assets — Cash or its equivalent, able to be quickly converted to cash such as stocks, money market instruments, and municipal or federal bonds
- Illiquid assets — Artwork, wine collections, junk bonds, undeveloped land
Organizing Information for a Financial Affidavit
Rely on your capable family law attorney to handle the bulk of the preparation. You will probably be called on to gather the research and necessary papers. Do not depend on your attorney to question every item, since you alone know your own financial history.
Leave to your attorney the task of finding the proper format for presenting your affidavit to the court, but start by pulling together and organizing all this:
All Sources of Income
What does that mean, “income?” In Virginia, it means all this:
- Salary, wages or base pay
- Pension and other retirement benefits
- Monetary gifts
- Interest income
- Dividend income
- Trust income
- Social security benefits
- Unemployment benefits
- Disability payments
- Worker’s compensation
- TANF and SNAP
- Military allowances
- Investment income
- Rental income
- Partnership income
- Royalty income
- Educational funds
- Child support for children your current relationship
- Child support for children from other relationships
Here you gather all expenses related to your home, work, personal purchases, dining, dry cleaning, groceries, child care, transportation, clothing, tools, medical and dental expenses, insurance payments, or any of over 100 different categories. Consider these:
- Investment costs, safe deposit box rental, private mortgage insurance
- Professional dues, union expenses, subscriptions to professional journals
- Vacation expenses, time share payments, recreational vehicle costs, expenses related to hobbies and pastimes
- Children’s clothes and shoes, school supplies, camper fees, musical instrument rentals, and sports equipment
- Landscaping, plumbers, handyman services, snow removal, pressure washing your home, HVAC repair, routine home repairs and materials
- Entertainment expenses like costs of birthday parties, cable television, internet, movies, theatre tickets, season tickets for professional sports teams, and man cave supplies
The court and your wife’s attorney need an accurate picture of the marital debt you share. This will be apportioned to each of you in percentages reflecting the percentage of assets you each get. In Virginia, “equitable” is not the same as 50-50. Consider all these types of debts to be divided:
- First and second mortgages
- Vacation or second home expenses
- Unsecured debts such as department store cards, gasoline credit cards, or bank cards (VISA, Discovery, Mastercard)
- Student loan payments
- Secured loans like car payments, ATV payments, or personal loans
If you are fortunate enough to have investments, savings, and retirement accounts, you have liquid assets. The term “liquid” means they can be converted quickly into cash and used for financing, say, a divorce. Here are typical liquid assets:
- Bank accounts, including Certificates of Deposit, savings, and checking
- Investment accounts, including ownership of stocks, municipal and federal bonds, and mutual funds
- Tax refunds
- Money owed to you by others
- Precious metals
Illiquid assets are assets for which demand is small or non-existent. Think of these:
- Penny stocks
- Ownership in a business
- Collections (art, jewelry, antiques, wine, baseball cards, Hot Wheels toys, cigars)
- Many options and futures contracts
- Junk bonds
While the affidavit can be revised after submitting it, this casts suspicion on you immediately, making your actions seem like you are hiding assets. You are better off divulging everything carefully and thoroughly, as a tiny mistake can be an expensive blunder later.
You are swearing under oath that all the details are correct and accurate; you are swearing under oath to have left nothing out. Perjury carries serious legal consequences under Virginia Code § 18.2-434.
Call Our Property Settlement Attorneys
At The Firm For Men, we can help with all aspects of divorce, including preparation of required documents. Contact us online today or by telephoning 757-383-9184. From a financial affidavit to answers to interrogatories, we will be there for you, representing your interests and defending your rights. We work exclusively with Virginia’s men in every type of family law challenge, from uncontested divorces to accusations of domestic violence.