Divorce can have a great deal of collateral damage. For instance, often the relationships the spouses had with friends and family members are adversely affected by divorce. Some of the friends of the couple and even close relatives may feel as if they have to “take sides” and wind up cutting off or limiting contact with one spouse.
But the potential for damage is increased when the spouses co-own a family business together. Then, the potential for loss is much greater.
Can my business weather the divorce storm?
Of course, taking preventive measures before there is need is always best, but if you and your spouse failed to sign a prenup prior to getting married, all is not lost. Learn how you can salvage your business from the wreckage of your divorce.
Buy out your spouse
If your business has been very profitable and you’ve managed to sock away a big nest egg, this may be the easiest way to sever your business relationship.
But not all business owners will have access to ready sums of cash, so you might need to take on a business partner who is flush with cash in order to extricate your spouse from the company. Failing that, a less palatable option is to take on a major debt load to buy him or her out.
Barter another asset
If your business is your lifeblood, you may decide to leverage another major asset — your share of the marital home or a 401k or pension plan. While you’re sure to take a hit, the business can increase its profits in the coming years and make this a lucrative decision.
Maintain your business partnership
This option will only work if the two of you are able to remain civil with one another. Those in particularly acrimonious divorces will not likely be able to soldier on together as business partners if they are sniping at one another over every minor issue.
This approach also might work out fairly well initially, but matters could break down once one or both exes take up with new romantic partners.
What’s right for you may not be right for everyone, which is why you and your Atlanta family law attorney should carefully weigh all of your options before choosing your course of action.