Divorce is never an easy road to go down. Even if your assets only consist of a couple of cars and a house in Greenwood Village, you could still be facing weeks if not months of negotiations before you reach a divorce settlement. However, if you also own a business, planning for your divorce becomes even more important to your future financial stability.
If you are planning to end your marriage and you own a business, you probably don’t want to see years of your hard work end up in the pocket of your soon-to-be ex-husband. The following strategies can help you divorce-proof your business.
Keep it separate
Keep your business separate from family finances. In other words, do not borrow money out of your joint bank account to buy equipment for your business.
Pay yourself a competitive salary
If you are not paying yourself enough to contribute to the welfare of your family and, instead, keeping the cash in the business, your husband’s divorce attorney might argue that he is entitled to more of your business’s assets. To avoid this, be sure to pay yourself a competitive salary and keep it accessible for your family’s benefit.
Fire your spouse
If your husband is an active participant in the business, it is time to push him out. The more of a role he plays in the company, the more of a foothold he has to claim a significant portion of the business for himself.
Be prepared to give up other assets
During the divorce process, your respective attorneys will add up all of your assets and present strategies for division. If you plan on keeping your business, be prepared to surrender other assets to your spouse. For example, in order to keep 100 percent of the company, you may need to relinquish your claim on the family home or other high-value assets.
Offer to make monthly payments
Another option you might be able to prepare for is to buy out your spouse’s claim on the company. You can offer to make monthly payments over time to pay him for his share of the business.
The above strategies can help you save your business in a divorce. It is always best to logically examine your options and plan for how best to approach property division, especially if a business is involved. If you are considering divorce, it is vital to take steps to protect your interests.