The Importance of Prenuptial Agreements for Business Owners

 Posted on June 13, 2022 in Prenuptial & Postnuptial Agreements

Owning a business can be both lucrative and deeply rewarding. However, as any business owner can tell you, it is not easy. Whether you are an entrepreneur running a startup or a business owner with decades of experience, getting married can change things. Anyone who plans to wed should understand how marriage and divorce can impact their business. One way to protect your business is through a prenuptial agreement.

A Prenup Can Protect the Business in the Event of Death or Divorce

No one gets married thinking that the marriage will end in divorce. The idea is unromantic at best and offensive at worst. However, statistics show that 40-50 percent of marriages do ultimately end up in divorce. Planning for this possibility is reasonable even if your relationship is thriving. Furthermore, prenuptial agreements can be beneficial even if a couple stays together until one of the spouses passes away.

You can use a prenuptial agreement or premarital agreement to classify certain property as marital property belonging to both spouses and certain property as non-marital property belonging to only one spouse. Without a prenup, business assets and income can become entangled with personal assets and income. This can make dividing assets during divorce much more complicated and contentious than it would otherwise be.

Prenuptial agreements can also be used to describe a spouse’s spousal maintenance obligations. For example, if the business owner is the primary earner in the marriage, the other spouse can be left in serious financial turmoil after divorce. A prenup can be used to ensure that the lesser-earning spouse will be entitled to spousal maintenance if the marriage ends.

Prenuptial Agreements Are Becoming More and More Popular

Prenups are often associated with frivolous celebrity marriages and the extremely wealthy. However, this stereotype paints an inaccurate picture of what a prenuptial agreement really is. Any couple of any income level can benefit from a prenup. Signing a prenup does not mean that a couple plans to divorce or doubts the authenticity of their relationship anymore than buying car insurance means a driver plans to crash. Life is full of unexpected twists and turns. Preparing for the possibility of divorce or the death of a spouse is the responsible thing to do when you own a business.

More and more people are choosing to sign prenuptial agreements before getting married – especially young couples. They know the benefits of discussing finances before they get married and understand the financial risks associated with marriage and divorce.

Contact a Kane County Prenuptial Agreement Lawyer

If you are interested in drafting a prenuptial agreement, contact the Naperville family law attorneys at Goostree Law Group for help. Call our office at 630-584-4800 for a free initial consultation.

Sources:

https://www.refinery29.com/en-us/2017/01/137440/divorce-rate-in-america-statistics

https://www.businessinsider.com/why-sign-a-prenup-marriage-divorce-2018-9