This episode of the Divorce and Your Money Show discusses art and collectibles during divorce. Many things fall under the umbrella of “art and collectibles”: paintings, stamps, coins, books, memorabilia, photographs, even Beanie Babies. These pieces are difficult to value, and you cannot simply divide them up like a bank account. How do you divvy these items up in a divorce?
How do you determine their value?
There are three steps to this process:
1) Understand what you have.
Take an inventory of all your art and collectibles. If you own items that are not in your house, be sure to include them. You may have items in storage or (in some cases) on loan to a gallery or a museum.
Here is other information you might need to know:
- Who is the artist or creator of the piece?
- When was it created?
- What is the medium? For example, is it a painting or sculpture?
- What is the provenance of the piece? For more expensive artwork and collectibles, it will be important to be able to trace where the piece came from, including all previous owners.
- Was it ever exhibited in a gallery or a museum?
- What condition is the piece in?
All this information will need to be gathered and disclosed in your financial affidavit or statement of net worth.
2) Determine the value of your art and collectibles.
Get an appraisal for each item that may be of value (i.e., more than a few hundred dollars). Do not rely on your spouse’s estimate. Unfortunately, you may have paid much more than the current worth of some items. And you may have other items that are worth a surprisingly large amount of money. To get an accurate picture of the item’s value, an appraisal is the best way to go.
3) Divide things keeping the big picture in mind.
Obviously, artwork and collectibles cannot just be split in half, as a bank account or investment account can. It is difficult to decide who keeps which items. Sometimes, people will negotiate buyouts. Other times, they split up items, so that each spouse gets items that are roughly equal in value. Often, people have emotional attachments to their art and collectibles, making these negotiations more difficult.
Therefore, it is important to keep the big picture in mind. Avoid spending a lot of time and money fighting over an item that is not worth it.
Divorce is an emotional time, and the additional emotions of dividing up items that you are attached to can make your divorce even more expensive. Prioritize the assets that are the most important to you, so you can make smart financial decisions.