If you run a business and are planning on getting a divorce, it makes sense to work out a strategy that gives you the best chance of keeping your business going strong after the breakup.
There is no question that facing a divorce can represent a significant bump in the road that you are going to have to negotiate and come out the other side as unscathed as possible.
If you need help with your divorce, you might to click here for more details. One thing is for sure though, this is definitely a time where you could do with a good business divorce strategy.
When you consider that up to half of all first marriages tend to end up in divorce, the odds are there for all to see, that you might be facing a situation yourself where you will need to develop a strategy to try and protect your business from such a troubling scenario, especially after discovering that the divorce rate is even higher for second marriages.
Once it becomes official and divorce proceedings are up and running, that will almost certainly limit your potential options, so if you want to preserve your business interests, it makes a lot of sense to think about this potential scenario even while you are enjoying a far more cordial relationship with your partner.
It very often happens that you get married at a young age where you are just setting out on your business journey and you have more optimism than money in the bank.
Fast-forward a decade or so and that fledgling business might look vastly different and be worth considerably more than when you first started out. When you are just starting out in a relationship and in business, probably one of the things furthest from your mind would be something like a prenuptial agreement, so you can’t blame yourself if you didn’t have the foresight or even the desire to impose a contract like this on a relationship.
Your changing fortunes are to be celebrated as a reward for your endeavors, but in a divorce situation, what you have built could be vulnerable.
Dealing with the present not the past
You can’t turn back the clock so rather than worrying about what you haven’t done in the past to protect your business from the effects of a divorce, it is better to focus your attention to dealing with the present and adopting a strategy that will help you to move on afterwards.
It is generally considered a good policy to try and keep your family finances at arm’s length from your business, which means that you buy company assets with company money rather than using personal or shared funds.
It also makes sense to pay yourself a decent salary where you can, as using household cash to build up the business could potentially make you vulnerable to a claim that your ex might be entitled to a percentage of the assets in lieu of that move.
The best course of action is to seek professional help on what to do and how to protect your business. It might be that you can take out an insurance policy to provide the funds you need to pay in a settlement rather than lose some or all of your business.
If you are just starting out, a prenup would help and there is even the possibility of a postnup, but if that is not feasible, seek some help in developing a viable strategy.
Caitlin Banks works as an assistant in a business finance and consulting firm. She enjoys sharing her research and expertise online. Her articles mainly focus on business disputes.