As this blog has discussed, part of the divorce or separation process in Arizona involves dividing up property. When doing so, one of the biggest if not the biggest issue involves asset valuation and division. It is an important issue because, without paying attention to it, a party to a divorce can end up getting an unfair deal that they may wind up just having to live with. Incidentally, understanding asset valuation is also important for happily married couples when they are selling something like a house, a car or even a piece of furniture.
One problem with valuation is that emotions often get in the way of doing it accurately. Generally speaking, a couple's marital assets are going to be value based on what a person who is motivated to buy would pay to a seller who truly wants to part with the property. This is called fair market value.
On the other hand, sentimental value is the value a person puts on his or her property without regard to the opinions of others. Usually rooted in emotions, hence the name sentimental value, it is also based on the efforts a person put in to acquire or improve the piece of property. History and even one's culture or personality can also affect sentimental value.
The problem with sentimental value is that it skews a person's perception on how much the property is really worth, making it hard to focus on the big picture. In the end, sentimental value could mean a person is willing to trade off way too much in the property division process to keep a piece of property which, although precious, is of limited financial value. Of course, sometimes it may really be worth it to someone to keep something with great sentimental value. These are considerations to keep in mind when negotiating a property division settlement that is fair to both parties.