How to Prepare for and Cope With Divorce as an Entrepreneur

Entrepreneurship is challenging for even the most enthusiastic creators and business moguls. But some of the most difficult parts of entrepreneurship are the effects that occur outside your business, rather than within it. For example, the divorce rate is higher for entrepreneurs than it is for the rest of the population. If your business—and your mental health—are going to survive the experience, you need to know how to prepare for the possibility of divorce and how to cope if it ends up happening.

Why Divorce Rates Are Higher for Entrepreneurs

According to Divorce & Custody Attorney Seth Shich, “Any marriage can end in divorce, but when marriages are put to the test with increased stress and financial instability, that probability skyrockets.” Entrepreneurs tend to spend long hours dedicated to their businesses, which means they’re less available for building and maintaining a relationship, and because money is often tight during the early stages of businesses, these marriages are less financially stable.

How to Prepare

It’s a good idea to prepare for the possibility of divorce, even if you’re currently happy; you never know how things could evolve. These are some strategies to protect yourself and your investment:

  1. 1. Think long-term. By the time you actually initiate a divorce, it’s too late to make any major changes. You need to make decisions for the long-term and think as far ahead as possible. You’re madly in love now, but can you guarantee you’ll both feel the same way in 10 years? In 20? Think realistically and plan for the worst, even in the best of situations.

  2. 2. Sign a prenuptial agreement. Prenuptial agreements aren’t a magic bullet that will instantly make your divorce easy to deal with, but they can hammer out a lot of details ahead of time. There’s a lot of flexibility here, so work closely with your spouse-to-be and determine exactly how your assets would split in the event of a future divorce. It’s in both of your best interests.

  3. 3. Sign a postnuptial agreement. If you’re already married and you have both individual and shared assets, you can also work together on a postnuptial agreement. These are similarly legally binding documents that can help you determine ownership and splits if a divorce ever unfolds between the two of you.

  4. 4. Pay yourself a reasonable salary instead of always reinvesting. Most entrepreneurs end up not taking a salary during the first few years—if they can afford the option—instead, reinvesting the extra income into the business to help foster new growth. While this is ordinarily a good strategy, it may be wiser to pay yourself a competitive salary instead. Not only will this lower your business’s on-paper revenue and projected value, it will also help you guarantee some income for yourself if ownership of the business changes.

  5. 5. Avoid including your spouse in a business. You may seem to work together brilliantly for the time being, but there’s no guarantee that will last forever. There have been isolated examples of husband-and-wife businesses that remain successful for many years, but the safer bet is to avoid including your spouse in the business altogether.

  6. 6. Use shareholders and partnerships to lock out a spouse. If you’ve failed to take precautionary measures and it appears your spouse may try to take over the business, you can use partnerships and existing shareholders to lock the spouse out of controlling interest in the business. This may require some careful reworking, but it can be a valuable last-ditch effort to retain control.
Coping Strategies

When divorce hits, you need to protect yourself as much as you protect your business. Here’s how:

  1. 1. Make time to face your emotions. You’ll never get over a divorce if you don’t confront your feelings about it, but being busy with the business can preclude you from that introspection. Make time for yourself and hash out how you truly feel about it.

  2. 2. Spend time with friends and loved ones. Your friends, family members, and loved ones know you best, and they’re the ones best able to help you through this difficult time. Take a break from work and spend more time with them as you navigate your way back toward normalcy.

  3. 3. Pursue hobbies that make you happy. Do you like going on hikes? Traveling to other countries? Playing golf? Whatever it is, make time for it. You need to relax and enjoy yourself as an individual.

  4. 4. Take care of yourself. Eat healthy. Get ample sleep. Exercise. Practice good hygiene. You need to take care of your mind and body. Otherwise, it will be even harder for you to recover from this event.

  5. 5. Get professional help. There’s no shame in going to counseling—in fact, it will probably help you process your feelings sooner and more completely, getting you back to work faster. You could also seek help in the form of a support group, or some other professional organization.
Nobody likes to think about divorce, and ideally, every marriage would exist happily ever after, but unfortunately, that just isn’t the case. Even if you end up in a long, happy marriage, it still pays to have your business prepared for the worst-case scenario. Otherwise, you could risk losing everything you’ve built—in addition to the most significant relationship in your life.

Author:.

Jenna is a freelance journalist specializing in technology, digital communications, marketing, and entrepreneurship.

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