Divorce is one of the realities that can drastically change anyone’s life. The country’s divorce rate may have dropped by 18% in recent years, but only because the marriage rate has declined as well. At any rate, a divorce still occurs approximately once every 36 seconds. Some good things never last, indeed.
Some variables that make a divorce process more difficult are the children, properties, and family business. The first two variables are inevitable, but the third one creates another layer of a tricky issue to tackle during divorce proceedings. With so many questions in mind, figuring out what to do with the family business can make one feel anxious and confused. Here are some things that may help.
The Possible Options
What to do with the family business now that a divorce is on the way? It is perhaps the first question that will pop in the divorcing couple’s minds regarding the family business. It is not an easy question to answer. There are four plausible things that you can consider:
- Sell the family business.
Sell it and divide the profits between you and your ex-spouse. Although this solution will cost money, it is straightforward and simple compared to the other options. It requires a team of 3-4 people to facilitate the process. You will need an appraiser to evaluate the market worth of the business. You will also need an accountant, a lawyer, and a financial advisor if you want full-on financial guidance.
- Buy your ex-spouse’s share…
It will be more costly than the first option, but it’s ideal if you’re going to continue running the business. You will need a fund to pay for the share of the other spouse; you may also pay using another asset. Either way, you will have to sacrifice a chunk of money or another property to carry on with this.
- …Or sell your share.
It’s good if you are not as invested in the business as the other spouse, and would rather move on from the business.
- Make it business as usual.
Believe it or not, this arrangement can work, although not for everyone, of course. It is possible for a divorcing couple who think they can both be amicable and professional and would want to continue with the business.
Smart Tips to Surviving Divorce in a Family Business
Some couples sign pre-nuptial agreements as a way of safeguarding the business in the event of a divorce. This idea of preparing for the possibility of divorce while still in a wedded bliss may seem fatalistic to many. But some couples deem it a practical choice.
In the absence of a pre-nuptial agreement, the process of sorting out the business during divorce can be extremely stress-inducing. Here are some tips to help you as you go through the hurdles of a divorce in a family business:
- Have a solid support system.
Surround yourself with trusted family and friends who can give you emotional and moral support. They can guide you through and keep you grounded. Some of them may even know the process either by experience or through their profession. They may be able to provide you valuable insight and advice.
- Hire a team of professionals.
During a divorce, emotions are high and may prompt some to make drastic business moves. Having a reliable team can help you make guided decisions and moves concerning the family business. Let the legal counsel, accountant, and financial advisor review and supervise your business decisions. They may cost money, but they are a significant resource to have during this period.
- Be prepared – mentally, emotionally, and financially.
Divorce is a time when you will be facing life’s different facets in a whole new way. You will find yourself needing to pull out money to pay for the lawyer, accountant, and a new household, among others. Accept the change and be prepared for it, and things will go a little more smoothly and easier for you later on.
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When it comes to handling family matters, the Lansing divorce attorneys at The Clark Law Office is a reliable choice for many in the Michigan area. Contact our team today.