Marriage may conjure images of a diamond engagement ring or platinum wedding band—but what about the jewelry you already own? How do you valuate your shiniest assets before signing your prenup and saying “I do”? For that matter—you may be wondering how to estimate the value of any complex or precious object, especially those imbued with sentimental value, in time for the big day.
One requirement of a prenup is that both future spouses offer a full account of their assets and liabilities, which means all assets must be given a value. When we think of assets, we may typically think of the most obvious, and perhaps most valuable, types: our savings, investments, house, or car. However, there are several types of personal assets you’ll need to value for your prenup. These include financial assets like stocks and bonds, intangible assets such as patents or other intellectual property, and other personal assets beyond a home or car—including jewelry, artwork, and furnishings. If you own a business, you’ll need to consider business assets as well, such as inventory, equipment, and buildings.
But how do you estimate the value of your great-grandmother’s necklace, passed down to you through generations, or the painting you’ve owned for years by an artist whose career has just taken off, or the beautiful antique chair you found at a consignment shop? The market value of these assets may be greater than what you paid for them, if you paid anything at all. It’s not only a requirement of prenups that this value be accurately documented, but it’s to your benefit to know the value of your assets and protect them in the case that you and your spouse part ways.
Below are three ways that you can estimate the value of these assets:
1. Get an Appraisal
When we think about estimating the value of personal assets like jewelry, for example, we might first think of getting our earrings, rings, and necklaces professionally appraised. This is certainly an option. If this is the road you’d like to go down, the first step is to find a certified appraiser, preferably one who specializes in the type of jewelry you’d like to get appraised. Think about what makes your jewelry special or valuable to you—is it the stone, the retro cut? Then locate an appraiser through the appropriate professional organization, like American Gem Society, American Society of Appraisers, or the International Society of Appraisers.
Professional appraisal is obviously available for assets beyond jewelry. You can also find appraisers for your antique furniture or the stamp collection you’ve had since childhood through similar professional organizations. You can also get your home and any other real estate you own, including commercial properties, appraised. In fact, for commercial properties and rental properties, professional appraisal may be the only way to determine their value.
However, professional appraisal can be an expensive and lengthy process, depending how the items you need to get appraised, and how many. Jewelry appraisal costs can range from $50 to $150 per item, or even per hour, and may take anywhere from a few days to a week or more depending on the complexity and number of items. For antique furniture, this process can take even longer. It may take four to six weeks to get your antiques appraised, not including the time it takes you to track down an appraiser, and it may cost anywhere between $100 to $300 per hour. Real estate appraisals can be far more expensive, depending on the size of the property. The average single-family home appraisal will typically cost a few hundred dollars with a one- to two-week turnaround time for the appraiser to complete their report. For a very large commercial property, this number can climb into the thousands or tens of thousands of dollars.
But what do you do if you don’t have time to appraise all of these special objects and assets prior to your prenup? When considering how to determine the value of your assets, you need to keep your prenup timeline in mind. Ideally, as soon as you or your significant other pop the question and agree on a prenup, you should start getting the prenup gears in motion. Many attorneys agree that a prenuptial agreement should be signed at least 30 days before the wedding date, so that neither party feels rushed into signing. Depending on which state you live in, there may also be specific laws that dictate your prenup timeline. For example, in California, both future spouses are required to have seven days to review the contract.
The timeline of the prenup, and the timeline of your wedding, may be at odds with the timeline of getting your items appraised. Between finding appraisers, and the complexity and quantity of your assets, you could be looking at a few extra weeks or even months that you hadn’t anticipated. Though professional appraisals may be worth it if you have the time and cash, you may want to look into the other options below if you have a tighter timeline and smaller budget.
2. Look to the Market
One option that’s available for real estate assets is comparative market analysis. Comparative market analysis is a tool that real estate agents use to estimate the value of your property by comparing it to similar properties that have sold in your area. Though the recent sales of similar properties in the area does play a role in real estate appraisal, the processes of market analysis and the process of appraisal do differ. A licensed real estate agent in your area can perform the market analysis. Compared to home appraisals, typically the cost is lower at $100 to $200 on average. Many real estate agents will also perform the market analysis for free, in hopes that you’ll use their services when you’re ready to put your home on the market.
Appraisers typically need to use the Uniform Residential Appraisal Report from Fannie Mae for single-family homes, which includes a laundry list of aspects to inspect and report on—which takes time. A comparative market analysis focuses on your home in comparison to about 10 nearby of a similar size that have sold in the last three to six months, looking at both the list and sales prices. It also considers additional amenities your property may have.
The same kind of comparative market analysis can also apply to your other assets. There’s often a difference, for example, in the value an appraiser gives a piece of jewelry and the resale value. Appraisal value is typically for insurance purposes and can be much higher than market value, as it doesn’t factor in the logics of the secondary market. Buyers of second-hand jewelry may not look at an appraisal value at all, even if one has been determined. They’re looking instead at the quality of the jewelry—in the case of diamonds, that might mean cut, clarity, and carat. Taking your jewelry to a reputable buyer may be the best way to understand the market value, and quicker than getting it appraised. It will also give you a sense of the market value of your assets.
3. Consider Online Resources
Lastly, if you are truly in a rush, consider using online tools to help you determine the value of your assets. For real estate, this might mean turning to Zillow or Redfin to help you look up comparable home values, or using an online home value estimator. You can also use online searches to DIY a comparative market analysis, but make sure you factor in every aspect that a realtor would.
You can use similar online resources for your other assets. If you know the details of your jewelry—to use the example above, a diamond’s cut and carat—you can look up similar pieces of jewelry online to find their market value. The same applies to your antiques and other collections. Ebay, Craigslist, and consignment sites, and consignment shops may offer keys to understanding the value of your assets on the secondhand market. Put your research skills to the test as you look through online resources. There are plenty of online guides available to help you determine the fair market value of your assets. For furniture, SF Gate’s guide recommends you consider the depreciating value of used furniture—20% per year for every four years. This process is easier when you know the original price of the pieces, but you can also do your research online to estimate what that price would have been.
Consistency is Key
Regardless of how you choose to estimate the value of your assets, consistency is key. If your spouse-to-be has time to get appraisals, likely you do too—and considering appraisals can be higher than market value, this is a good idea. However, if you’re both on a tight timeline, looking at the market and making use of online resources are great ways to estimate the value of your assets with a lower cost and higher turnaround time.
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