Without a strong family business divorce strategy, the effects of divorce on a family business can be a drastic threat to the family and to the business. Of all the problems a family business can face, one of the most difficult to deal with is divorce. Divorce in a family business affects everyone in the family. It can also impact non-family members working for the family's business. People must think beyond just the legal ramifications of divorce - and to develop a comprehensive family business divorce strategy.

Research on divorce indicates that about 50% of all marriages in the United States end in divorce. The statistics on second marriages are even worse. Only about 30% of family businesses successfully survive from the first generation to the second; about 12% successfully continue to the third generation and only about 3% reach the fourth generation. family business. The causes and effects of divorce influence these statistics, and a family business comprehensive divorce strategy can mitigate the problems.

How effective are Prenuptial Agreements?

Prenuptial agreements will not prevent the causes and effects of divorce, but they can help minimize some of the legal haggling associated with divorce. However, many business families do not take advantage of the prenuptial agreement. Very few families actually use a prenuptial agreement, not because they think it is a bad divorce strategy, but because they do not know how to have that sensitive conversation, prior to a marriage.
Having a Quick and Easy Divorce:

Generally, a couple can have an "easy" divorce when there are no children involved and there are not a lot of assets involved. But that is not the case if the couple getting the divorce are also business partners. When that is the case, the divorce can become a tangled web that can be costly to resolve, in terms of accounting and legal fees - and may even force the liquidation of the business.

The impact of divorce on a family business is disastrous in so many ways that it would be difficult to address all of the issues, short and long term. For families in business together, divorce is a devastating. For family businesses, it makes sense to have a comprehensive divorce strategy such as having an quick and easy divorce without involving attorneys in a legal battle.

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