November 2, 2016
Partners in Life and Partners in Business: Dealing with a Double Split
When you consider that about 90% of U.S businesses are family owned, it is obviously a big issue when there is a relationship breakdown and you are no longer partners in life, but are still partners in business.
If you find yourself in this situation, it is likely that you could do with some guidance from someone like www.divorceguru.com as to how to deal with tricky scenario caused by a relationship breakdown.
Here is a look at how to keep the business going as usual after a divorce.
Divorce complicates things
It is fair to say that within many marriages where there is a family business providing the bulk of the income and forming a substantial part of the assets, divorce will complicate matters.
The other point to consider is that a family business is not just one of the most valuable assets within the marriage, but it is also likely to be the most illiquid too. This means that if it comes to a point that the business needs to be sold, this could be detrimental to all concerned, as it might result in a substantial loss in value.
If there is an agreement in place that outlines what action will need to take place in the event of a divorce situation, that at least will provide direction and guidance on how matters are going to be settled, but the main focus for all concerned, should often be how to maintain and protect the business so that it can survive a divorce situation and provide the cash and income that both parties are looking for.
Finding a viable solution
Each divorce situation is different in its own way and you may have already drafted some preventative measures that help to protect the business, but if that is not the case, the aim should be to find a viable solution that works for both parties.
If you have spent a long time building a successful business, you will not want to be forced into a situation where you have to close the business or sell it for less than its true value. You might not want to carry on working with your spouse as a business partner considering you are getting divorced, which definitely complicates things.
In an ideal situation, it is hoped that you and your former partner are at least able to take a rational approach and seek out a compromise that works for both of you, as much as possible.
The key is often to remove the emotional attachment from the discussions and negotiations, so that you can achieve a more suitable outcome through acting as objectively as possible. It would be a good idea to get some professional help on the situation and get someone to appraise the value of the business and come up with some independent opinions on what would be a suitable way forward, that would benefit the business as well as you personally.
One of the best tips to bear in mind when you find yourself in this situation, is to avoid making any changes within the business while divorce negotiations are ongoing, as there is the chance that a judge might take a dim view of your actions.
Corey Burrows is a business analyst and personal finance consultant. He enjoys enlightening his readers with little known facts from the world of finance and economics. His articles mainly focus on family and finance issues.