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A prenuptial agreement is a wise tool for business owners

On Behalf of | Mar 13, 2020 | Firm News

Getting married is an event that many people look forward to. Finding the love of one’s life can be a magical experience, but you and many other people know that relationships can have their downfalls, even when they are full of love. Because not everyone has a marriage that spans for the rest of their lives, you understand that you could be one of the many people to face divorce.

Because you are also a business owner or are planning to start a business, you do not want an event like divorce to harm your company in any way. Fortunately, before you tie the knot, you can create a prenuptial agreement if you wish to do so. The terms of the agreement could indicate what will happen to your business assets should your marriage come to an end.

Is a prenup necessary?

Not all couples opt to create a prenuptial agreement. However, almost all couples could benefit from this document, and as a business owner, you may have a greater need for one than many others. If you already have your business up and running before getting married, it will likely not be marital property under California community property division laws. Still, any assets the business obtains after your marriage can count as marital property.

A prenup can detail whether your spouse has rights to any business assets and how much. It can also set up protections to prevent your spouse from obtaining the business as a whole or a large portion of it during the property division proceedings. Of course, your prenup can address other matters as well, such as:

  • Agreeing on future spousal support payments
  • Deciding how specific assets will be handled during the division process
  • Coming to terms on the division of debt, especially if one person has a significant amount of debt before getting married
  • Determining the financial responsibilities for each party in the event that you have children

A prenuptial agreement can cover many areas, and going over the various ways you could use this document to protect your business and other areas of your work and personal lives may be worthwhile. Speaking with a knowledgeable attorney about how you can create a prenup may help you come to the best terms possible to safeguard against the possibility of divorce in the future.