How can you minimize the impact of a divorce on your business?

On Behalf of | Feb 25, 2022 | Divorce

When you’re going through a divorce and run a business, the reality is that there are days when your mindset and legal issues may impact your business. It can be tough to handle your business if you’re a co-owner with your spouse, since you may not work well together at the moment, and it may be hard to keep your business running if your spouse is entitled to a portion of it in the divorce.

Put frankly, divorces are disruptive to people who run businesses, but there are ways to minimize the impact. Here’s what you should be thinking about.

  1. If there is a prenuptial agreement, check it to know how to handle your business

To start with, if you have a prenuptial agreement, it’s a good time to check that agreement and determine if it helps protect your business. For example, if you owned your business before marriage, you may have included a clause to prevent your spouse from gaining any ownership or financial support from it following a divorce.

  1. Focus on keeping excellent records

Another thing to do is to start gathering records. You need to keep excellent records to make sure that your personal and business expenses stay separated. You also need those records to determine how much your business is bringing in in revenue as well as to determine its value if you decide to sell.

  1. Decide if keeping the business open is right for you

Finally, you should decide if keeping the business open after your divorce is the right choice for you. You and your spouse may run this business together at the moment but realize that you don’t want to in the future. You may want to buy out their portion of the business, or they may want to take it over on their own. You both may also agree that it’s just time to sell and to split any profits you earn from that sale.

Your business is unique, so the approach you take to address it during a divorce will depend on your personal goals and objectives. Get to know the different options for separating property during the divorce, so you can decide on the right method to help you move forward.