When you’re a business owner, a divorce not only has the capacity to upend your personal life, but it also has the potential to disrupt your entire company.
What can you do? Plenty. Business owners always have to look ahead. Here are some things you should consider now (even if you aren’t currently considering a divorce):
- Protecting your business doesn’t mean cheating your spouse. You always have to disclose your income and assets in a divorce. Trying to hide them can backfire in ugly ways when it comes to a court-ordered settlement.
- Foresight can be your best defense. It’s easier to be reasonable and discuss a fair split where the business is concerned while everything is going well in your marriage. A prenuptial or postnuptial agreement can set the guidelines for what will happen if a divorce eventually happens.
- You need to address the potential hard feelings. Don’t convince yourself that you and your spouse could work together as business partners even if your marriage ends. Discuss how the business will be divided, including who may have to buy the other out.
- If you hire your spouse, pay them fairly. If the business is clearly yours and you’ve taken other steps to protect it, don’t make the mistake of treating your spouse like free labor. That could backfire in a divorce. Pay your spouse a fair wage for their services.
Mitigating the risk to your business in a divorce is just part of entrepreneurship. Even if divorce is on the horizon, there may be steps you can take now to strengthen your position. Find out more about your legal options today.