U.S. residents are known for being extremely entrepreneurial and innovative. Now, more than ever, the concept of start-ups and crowdfunding/sourcing are becoming increasingly popular as this allows for everyday people to take an idea and, with very little investment, turn it into a business venture with the opportunity for growth.
The well-known adage is that personal relationships and business never mix. But more and more, power couples are surfacing and becoming successful specifically because they are functioning as a marital unit. More likely than not, having your spouse be your business partner creates a situation where any profit or loss is shared with the person who you trust the most. As many couples who run profitable businesses will attest, it is all about communication, creating ground rules, and sometimes a postnuptial agreement for more complex decisions for the marriage and business.
Illinois Prenuptial and PostNuptial Agreements: Their Use in Business
In Illinois, most people are aware of the existence of prenuptial agreements, which are legal agreements outlining the financials and sometimes lifestyle choices of couples. Usually the prenuptial agreements dictate who will get what when in the event of a divorce. But many times the agreement can determine what happens to the couple in the event of infidelity, the number of kids, how to separate holidays between in-laws, and other family obligations.
Postnuptial agreements can be add-ons to the original prenuptial or be set aside on their own merit. Using a postnuptial agreement can help in cases where circumstances in the marriage have changed such as one of the spouses leaving the “stay-at-home” parent role or in the event that the couple starts a business.
What to Put into Your Postnuptial Agreement
The key to creating a postnuptial agreement for couples that are starting a business is to not delineate every aspect of the roles and duties of the business; instead, that is the purpose of the business documents, articles of incorporation and the like. The postnuptial agreement is to determine how the business will affect the marriage or how the marriage will affect the business, in the case of a marital strife or divorce. For example, having a postnuptial agreement during a divorce may help to determine whether the couple will keep running the business together regardless of their marital status, or if one spouse needs to cash out and walk away.
Considerations for Entrepreneurial Couples
Regardless of whether you decide to protect your marriage and your business with a postnuptial agreement, it is important that the following is considered before your start-up has hit the stage.
Short-Term/Long-Term Shared Vision
Ensure that you both share the same short-term and long-term vision for the business. Analyze what each of you believes is the mission and objective of the business and make sure that they are in line or at least complement each other. Knowing the signposts for when you both are willing to pursue the tough times or get out of business is important.
Spheres of Influence
Delineate the roles and responsibilities. Having one of the spouses only dealing with the finances and the marketing, and the other dealing with the day-to-day responsibilities, for example, will make it understood when a decision falls under the purview of one spouse or another. Making a decision may not always be easy, but knowing who is responsible which decision will help.
If you can, get office space outside the home for the business. The more physically and emotionally distinct the business and the home are, the more likely that issues from the business will stay out of the home and vice-versa. Even if you are still mad about your spouse not washing the dishes, you still must be professional and work together. Silent treatments hinder productivity. On the other side, learn when to shut off when you are at home and be in family mode.
Money/Conflict Resolution Strategies
Money and finances collectively act as the number one cause of marital strife. Going into business makes that statement even more profound. Make sure that all spending/saving strategies are discussed and have a conflict resolution strategy regarding issues (financial and otherwise) where you disagree.
Experienced Family Law Attorneys in DuPage County
Prenuptial and postnuptial agreements are extremely helpful in determining how to resolve complex marital issues. The family law attorneys at Mevorah Law Offices LLC can help advise you on matters to consider before going into business with your spouse and how to protect your marriage. Contact our skilled DuPage County family law attorneys today for a free and confidential consultation.
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