Before entrepreneurs marry, they and their future spouses may both be wise to seek legal counsel. A prenuptial agreement is an important option to consider.
After the wedding, the legal options and the emotional stakes change.
But some entrepreneurs start their businesses as married people, or they jumped right into marriage without a prenup Even they can still put their legal house in order, including a possible postnup.
Prenups are possible in a community property state
Texas presumes anything gained during the marriage belongs to the marriage, not to one spouse. According to state law, Texas divorces involve splitting the property “equitably.”
However, this does not mean 50/50. In means in a right, fair and just way. A postnup cannot that equity sign away, but Texas courts typically respect agreements signed voluntarily with full access to all information about assets.
Also, Texas provides rules for separating community property into separate individual property, as well as making separate property community. Much is possible if done correctly.
Besides, postnups can be part of a larger strategy (which also must pass tests for fairness).
For example, the entrepreneur can create and control a trust to hold the business assets. This may assist the postnup in protecting business assets.
Why would a spouse ever agree to sign a postnup?
Couples create postnups together for many sensible reasons.
Some entrepreneurs do not mind risking money and other assets on prime opportunities, sometimes understandably “stressing out” their spouses. The right postnup may give the entrepreneur more room to maneuver and help their spouse feel more forgiving.
Also, successful entrepreneurs know more money means more problems, including increased stress.
Having increased finances can raise questions about the future of those assets. And more options in life often create disagreements about life choices. A postnuptial agreement might help return the marriage to a more relaxed place.
Finally, many spouses appreciate that businesses employ people and satisfy the needs of their customers. Its value, even financially, is often in its people and brand. Protecting a business can be about much more than protecting the personal assets of one person.