PEACE OF MIND
You and your spouse live together, work together and likely spend a great deal of your free time together. Having a successful marriage and business takes hard work and dedication, but it can also be among the most rewarding things in life.
To help keep you on the right track, here are a few tips.
Create separate budgets for your family and your business. Money can be a tense topic. With a family and a business to run, it is especially important for the two of you to agree on a budget for your family as well as a budget for your business.
Keep work at work. It is important to create a boundary between your work lives and your home lives. If your business has a physical location outside your home, establish a rule that you and your spouse will discuss business only while you are at work.
If you and your spouse are running a home-based business, you can establish “business hours,” and any time outside those hours is personal time when business will not be discussed.
Have your own hobby. Because you probably spend so much time together, it is important for each of you to take time alone to do something that you enjoy. Having your own hobby allows you to take a break from the usual routine.
Have your estate plan prepared or reviewed. When a couple works together in a business, their financial picture and overall goals may be complicated and intertwined, making proper estate planning an even greater necessity.
Below are some of the basic estate planning tools you need to protect yourself, your family and your business.
• Revocable living trust. With a revocable living trust, your money, property and even your interest in your business is owned by the trust rather than by you personally.
In creating the trust, you can name yourself as the trustee (the one in charge of managing the trust assets) and as the current beneficiary (the person who gets the enjoyment from the money, property and business).
The major benefit of having the trust own your assets is, when you die, these assets pass to your designated beneficiaries without having to go through probate court proceedings.
Also, if you are ever unable to manage your affairs while you are alive, the successor trustee can easily step in and take over management while preventing an unwanted disruption.
In addition to avoiding probate, a trust allows you to provide some instruction for the future of your business.
• Financial power of attorney. By default, no one, not even your spouse, can make financial or legal decisions for you during your lifetime unless you legally select someone through the creation of a financial power of attorney.
Executing a financial power of attorney can facilitate a smooth transition during a time, you are unable to make decisions for yourself.
• Medical power of attorney. As with financial matters, no one has the authority to make medical decisions for you during your lifetime unless you select them through proactive medical power of attorney.
If you are unable to communicate your wishes when an emergency arises, it is important that the person who will decide your course of treatment is someone you trust.
• Limited liability company or other business entity. Part of the planning process may include reviewing your business structure to ensure that it has been set up in a way that offers you the maximum asset protection, tax benefits and ease in transitioning ownership to the next generation.
One common way to achieve these benefits is by operating your business through a legally recognized business entity, such as a limited liability company (LLC). As part of your estate plan, you may then choose to transfer ownership of the LLC to your living trust to help secure all of the advantages of a living trust outlined above.
Having a successful marriage and business takes hard work. Speak with an estate planning attorney to assist in ensuring that your family and business are protected if unforeseen circumstances befall your family.
This article is provided as a service of the Law Office of Lasca A. Arnold, PLLC.
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