As the owner of a business in Oregon, your personal life almost inherently affects the professional aspects of your working life. Your decisions have an effect on the business as well as your own life, meaning one often affects the other. One aspect of your personal life that may have an expected impact on your business is the state of your marriage.
More than half of all U.S. marriages end, with the likelihood of divorce increasing for second, third or fourth marriages. The reality is, starting and maintaining a business can cause a strain on a relationship, sending a couple toward a potentially litigious end. There are a few key considerations for business owners to implement both at the start and end of a marriage.
Before the marriage
It’s useful to think ahead and take preventive measures to protect your business from the influence of personal problems. As a prudent business owner, it may be in your company’s best interest to procure a prenuptial agreement defining the business as separate property and not a shared marital asset. This establishes a legally binding agreement that an estranged spouse can’t seek a share of the business during a potential future divorce.
Similarly, a postnuptial agreement may establish a similar delineation after the wedding. This is not always the most ironclad solution, but it can help in the case of a potential split to make a case that the business is not part of the marriage’s assets. Beyond martial agreements, include ownership information in your business documents such as a partnership or shareholder agreement that provides a pathway for dealing with an owner’s potential future divorce.
During the marriage
If the business is a venture independent of the marriage, try to keep it that way during the marriage. The more involved your spouse is in the inner workings of the business, the greater stake they may have in a future asset division. Treat your career as a business owner the same you would as a regular employee.
Try to avoid using marital financial assets to offset company costs. Taking from the communal pot to feed the company’s financial situation can bolster a case that your spouse has a tangible, vested stake in the business.
As the business owner, it’s up to you to keep the professional and personal as separate as possible in case of future disputes, no matter how unlikely they may seem. Don’t let your livelihood come into jeopardy during the divorce process.