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Your Guide to Protecting Your Marketing Business Assets from Divorce

protecting assets from divorce

“Till death do us part.” That was the promise. Unfortunately, though, you’ll soon be breaking that promise.

Don’t feel bad. The divorce rate has been steadily increasing for some time now, so you’re not alone.

In any case, you must prepare for the upcoming legal battle. What’s the thing that should most concern you at this point?

Protecting assets from divorce.

To be more specific, you should be trying to protect your marketing business assets from divorce. You’ve worked too hard, after all, for someone to take a chunk of the small empire you’ve managed to build.

How, though, do you go about protecting your assets while going through a divorce?

Let’s take a minute to go through some of your options.

Pull Out a Copy of Your Premarital Agreement

The first thing you’re going to want to do is pull out a copy of any premarital agreements you made. What if you didn’t make any such agreements? Don’t beat yourself about not doing so.

Most people don’t, after all, plan to divorce their spouses.

In any case, premarital agreements can often save you a lot of trouble if they indicate that your business is a property owned by you.

But here’s the thing:

These agreements work much better if you owned the business before you wed your partner. Why? Because you can much more easily prove that you used your own resources to get the business up and running.

What happens, though, when you start a business shortly after you wed your partner? Is there no way to protect your business in this case?

As it turns out, there is another option. It’s called a “postnup,” and it functions much like a prenup. The only difference is that you and your partner sign the agreement after you’re married.

We should, though, mention that judges are much more skeptical of postnups than prenups. Especially if you didn’t introduce those postnuptial agreements early in your marriage.

Gauge Your Spouse’s Contributions to Your Business

Let’s say that you started your business sometime after you married your partner. In this case, you’re going to have to prove that your spouse didn’t make significant contributions to your business.

But what counts as a “significant contribution”?

The most obvious contribution anyone can make to a business is a monetary contribution. So if your partner made a decent-sized monetary contribution to your business, you might be in trouble.

And your troubles don’t necessarily end there.

Simply put, money isn’t the only contribution a person can make to a business. Some people, for instance, provide businesses with ideas. If business owners use those ideas, the people who provided ideas have contributed something to those businesses.

If your spouse works for your company, that also spells trouble for you. You’ll have a hard time proving that your spouse didn’t contribute a single thing to your business in this case. That said, immediately firing your spouse is the right move if you’re in this situation.

Check Your Business Records

Maybe your spouse has never worked for your business and didn’t contribute a thing to your company. Well, you’re not out of the clear yet if you used your family’s finances for business purposes.

If you’re guilty of this, we have one thing to say:

Never borrow from your family’s account to pay for business-related services or assets. Always keep work and play separate.

So how can you prove that you haven’t done such a thing? By keeping business records.

If you’ve kept detailed business records, you’ll be able to immediately verify that you used company funds to keep your business afloat.

Place Your Business in a Trust

Placing your business in a trust is one of the best things you’ll ever do if you end up divorcing your spouse. That’s because doing so will allow your business to function normally while ensuring that the law doesn’t count it as a marital asset.

Of course, the law won’t regard the business as a personal asset of yours either. As a result, you’ll want to make the trust revocable.

Be Prepared to Give Up Other Assets

We’re going to be completely honest with you here:

Sometimes the courts will rule that your spouse does have a stake in your business. That’s the way the cookie occasionally crumbles.

In such cases, you must be ready to give up other assets. Needless to say, those assets should be equal to your partner’s stake in your business.

Note, however, that the term “equal” doesn’t refer to monetary value. Some people, for instance, would be okay with losing their stakes in a business to keep a family home which is worth less than said stakes.

In other words, the sentimental value of the home or the security homeownership provides is worth more to some people.

In any case, no one knows your spouse better than you do. For this reason, think long and hard about whether the assets you’re willing to give up will satisfy your spouse.

Opt for a Separation Agreement Instead

When people decide they no longer want to be with their partners, they usually think of divorce as the obvious option.

But divorce isn’t the only option available to you.

You can also opt for a marital separation agreement. These agreements allow you and your spouse to discuss how you’d like to handle your assets without divorcing.

Think of a marriage separation agreement as an added step. It gives you more time to think about how you want your separation to play out. In some cases, it even gives you time to think about whether you even want to separate.

You should know, though, that both parties must agree to a separation agreement. So if there’s bad blood between you and your spouse, you might well end up with an intense legal battle on your hands anyway.

If you’re interested in finding out more about separation agreements, you can learn more by clicking the link we’ve provided.

Are You Concerned About Protecting Assets From Divorce?

For a married entrepreneur, protecting assets from divorce is crucial. Thinking about one day divorcing your loved one is uncomfortable, but you have to prepare for the worst.

If you’re interested in finding more tips on how to protect your marketing business, you should browse our blog. You can also contact us if you have any questions or concerns.