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Should you sell investments to split them in divorce?

Your divorce means dividing your assets. Much of your money is tied up in investments. You like to have that money working for you 24/7, increasing your wealth even while you sleep.

However, the easiest way to divide those assets, you believe, is just to sell them and split the proceeds. It seems straightforward. That's the same thing you're going to do with the house, which you plan to sell on the open market. Is this a wise choice for your investments?

It can be in some situations, but you should know that selling them can have a negative tax impact. By selling, you may need to pay taxes on the money, and you need to take that into account when determining what the investments are really worth.

On top of that, selling them may not be the best investment strategy. Maybe you think that the investments are just going to keep going up, but you bought them when they were very low. You're not ready to sell. It undermines what you've been doing with those assets all along.

You may be able to divide your investments without selling them. You can just split the shares with your spouse. After doing so, you are free to keep or sell your portion as you see fit. However, you're not forced to do either -- and your spouse's desires have no impact on your own investment portfolio.

Dividing assets can get complex, so make sure you know about all of the legal steps you will need to take. Your family law attorney and your financial adviser can offer valuable guidance.

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