Our most forwarded show in 2017 was with Lee Davis, a litigator and “business divorce” lawyer that we interviewed during the dog days of summer. Picking up on that theme, this week we interviewed Alvah “Al” Smith, a veteran divorce lawyer of thirty-three years, specializing in working with high net worth individuals, business owners and complex cases.
The majority of our guests and listeners are happily married and will probably never have need of a divorce lawyer. But, you might have a friend, family member, or colleague for whom this is the perfect topic. Thankfully, after thirty-three years with his own wife, Al has never had to use his own services. So, he has great marriage advice, too. This week, we take a break from artificial intelligence and corporate culture to discuss the most important business partnership of your life: your marriage.
Before: Get a Prenup
According to Georgia law, assets acquired before the marriage are not considered marital assets. But, assets acquired during the marriage (except for inheritances) are considered marital assets. For a CEO, this may include some of the appreciation in your business’ value, if you are a founder, or equity in the business, if it’s earned while you are married. However, prenups can change everything. And, they are almost always upheld in court.
So, if you are thinking about get married (or remarried), get a prenuptial agreement. Not the most romantic thing in the world, but you need to do it. Al advises, “If they have fairly significant assets, a premarital business or something, they ought to have one. And, to be honest with you, I advise my business owners and the money spouse, that you are a fool not to have a prenup.”
You won’t be alone. The frequency of prenuptial agreements is increasing. In the CNBC article, Prenups: Not just for the 1 percent, they site six factors for why prenuptial agreements are important for regular people, too:
- Entrepreneurial endeavors—Individuals want to protect their business from being affected in the case of a divorce
- Older brides and grooms—People have more assets to protect and a more complicated balance sheet at the time of marriage
- Swelling debts—People want to be protected from their spouse’s student loans or credit card debt if they split
- Reproductive rights—Many couples invest a great deal on fertility treatments. Who gets the embryos?
- Blended families—Many people want to secure assets for children from previous marriages
- Social media—Some marriage contracts specify how a potential divorce will be discussed publicly to protect reputations
While asking your future spouse to sign a fourteen-page contract might make him/her want to throw the ring at you, prenuptial agreements are not necessarily about depriving your future spouse. Al points out that the best use of a prenup is clarifying and documenting the pre-marital assets for purposes of transparency. And, transparency is good for communication—which brings us to Al’s advice for how to stay married, after you get that prenup signed.
During: Focus on Communication
Although it doesn’t help his job security, Al wants people to stay married. To that end, he recommends, “Make sure you stay in a good, happy marriage and you keep the communications open between the two of you… One of the major starting points of divorce is communication and lack thereof, which leads to other problems in the marriage.” He later moves on to say, “I think even issues like adultery and sometimes even issues with addiction can be the result of this failure to communicate, and failure to keep a close relationship. Have that time together…I think that spouses need some individual, some alone time with each other. I mean that’s not really alone, but together without the kids. Have that date night. I think those things are very important to try to keep your relationship alive and keep your marriage together.”
Communicate with your spouse. You didn’t need to read this article for that advice, so what does that mean in real life? Enter the weekly marriage meeting, a recommendation from The Art of Manliness website. It’s a meeting every week to discuss the health of your marriage and all that goes into it. “If you want to plan and tackle life’s greatest adventures side-by-side, you’ve got to stay in-sync and work effectively as a team. As marriage therapist Marcia N. Berger, puts it: “The art of marriage is really the art of keeping up to date with your partner, of staying on track with your own and each other’s life goals as they emerge, exist, and change. It is about supporting each other and staying connected emotionally, intellectually, physically, and spiritually.” If your business colleagues are worth meeting once each week, isn’t the most important person in your life worth at least that much?
On the Way Out: Don’t Do Anything Stupid
Once you’ve exhausted your options for keeping your marriage together, Al has some clear advice for CEOs considering a divorce. “I’d have people come in and tell me sometimes, ‘I’m thinking about getting divorced, what should I do? Should I start transferring assets to my brother? Do I put things in trust?’ I don’t ever advise doing that; a lot of that is just going to come back to haunt you…We jokingly call it RAIDS when someone gets divorced; it’s Recently Acquired Income Deficiency Syndrome. That all of the sudden, their income goes from in half…But, those things never work out. So, just live your life and if it happens, it happens.” Operate your business the same way you always have. Don’t make any changes in anticipation of splitting assets.
In fact, Al’s biggest recommendation is to keep your head together. In particular, he suggests that anyone going through a divorce should start seeing a counselor or therapist. Yup. He said it: “I think the first thing I would tell anybody, particularly if they’re very emotional about it, get some counseling. [I’m] your lawyer, we’re not trained to be counselors and therapists. We do a lot of it just ‘cause it happens, but I would highly recommend, find a good therapist.”
The long pleasant evenings give us a few extra hours enjoying the weather and loved ones, including spouses. Wherever you are in that relationship, there are issues to consider as a CEO that may be different than the average person. Before: Have a good agreement to document your assets and protect you from risk. During: Don’t let the long hours and stress impair communication. After: Stay calm and run your business. Keep these in your back pocket and enjoy the rest of the summer.