When you’re going through a divorce, one of the pieces of property you may need to divide is your stock options or restricted stocks. Many people overlook their stocks, because they forget about them or don’t consider their potential worth.
The truth is that dividing all your marital assets is important, regardless of what the stocks may or may not do in the future. Stocks are some of the most difficult things to divide fairly, so here are some things to keep in mind.
First, know that these are potentially valuable stocks and options. Usually, people obtain them through work, where they’re either given or purchase stocks. There’s a potential for those stocks to grow in value as the company grows, but there’s also a risk of the stocks depleting.
During your divorce, make sure you know the status of the stocks. Some stocks, like restricted stocks, aren’t available until the worker meets certain restrictions. For instance, the stock option might be restricted until the person has worked for the company for five years. It’s important to find out what kinds of stocks are available and how soon you or your spouse can sell the stocks.
Once you know what’s available, you have to value the assets. It’s hard to do, since no one knows how much stocks may be valued in the future. If the stocks are for a publicly traded company, it’s best to value it based on current share value.
Sometimes, stocks aren’t considered marital property until they’re vested, so it may not be a major issue in your divorce. It’s still something to look into, so you know you’re getting what you deserve out of your marriage.
Source: Forbes, “Dividing Stock Options And Restricted Stock In Divorce,” Jeff Landers, accessed Feb. 08, 2018