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Getting married in community of property is hazardous to your future. What to do about it.
Small Business and Marriage: good bed mates?
Getting married in community of property is hazardous to your future. What to do about it.
Marriage is probably a strange subject to discuss in this Weekly Business Idea, but please bear with me for a while as I recount untold tales of marital horror not to humour the men amongst us who have more than enough tales of their own, nor to vex the fairer gender.
You see, the law hasn’t kept up with reality in this regard like so many other archaic aspects. It is, I am told, still illegal to take your pig for a walk in Arkansas on a Sunday, or is that Aliwal North?
There are 2 main ways to contractually cement your union with a member of the opposite gender. The oldest is known as getting married in community of property.[This is the default method because you don’t have to do anything other than pitch up at the church on the right day at the correct time.]
More recently we have the legal construction of an ante nuptial contract. [Ante = before. Nuptial = marriage. Contract = Latin.] To complicate issues, the ANC [Ante Nuptial Contract] can be with [or without] accrual. Frankly I don’t care, because that’s not what I want to talk about this week.
What I do want to talk about is why our children should never, never, not ever, nooit, nyet, nein get married in community of property. It’s a bad thing in a modern economy especially the way we South Africans do it. If you are not yet married, do not even consider it no matter what your background is. And if you are married, and you find at some point in your future that you are no longer married when you consider your next nuptial adventure give community of property a miss. Let me explain.
The main reason young ladies are persuaded that this community of property thing is a good deal is that their parents think they are going to get rich from the efforts of their entrepreneurial groom. And the groom is so besotted that he fears that the mention of tawdry legality will alienate this bewitching Aphrodite he has miraculously captured.
[Actually, that’s a tad unfair. The reality is that most of us don’t even think about it during this exciting time. After all, finding a good photographer is far more important, isn’t it?]
Of course, I speak from a mere 20 years of experience, and mostly from a business perspective so please don’t think I am fighting with your pastor on this matter. Let’s look at how it all goes down.
About half of all marriages in South Africa, I am told, end in divorce. And about 96% of business startups end in failure. Given these two numbers, it doesn’t take a degree in astrophysics to figure out that your average Aphrodite is not going to enjoy a financially profitable marriage in community of property. Basically, this type of relationship cement means that each partner shares equally in the good [hopefully], and the bad [probably]. And when a business fails, it gets pretty bad financially. If you have been reading this weekly for a while you will know that I have been there.
Over the past few months I have been involved with [not in the Biblical sense, you understand] a number of women in the throes of divorce. In each case the former Adonis in their lives had managed to close a business recently and in the process had managed to lose everything that the two of them had accumulated in their entire time together. Not only losing everything, but incurring huge unpaid debts usually via sureties as well.
The real problem with the communal estate situation is that neither of you is safe from the bad stuff that hits the other. You are both in the brown stuff together. [No matter how joyous your union today, when the money flies out the window the smelly stuff flows in.]
In my mind the concepts of marriage in community of property, and business ownership are mutually exclusive. They cannot go together.
I could tell you about Jane, whose husband left her with 2 kids, no job, the debt owing on the house, immense surety bills, and hasn’t paid the maintenance these past 2 years. She is struggling to get back on her feet – 4 years after he left. Or was that Denise, or Rose [1 youngster], or Natasha [3 youngsters], or the other Denise? There are so many horror tales that are so similar, and so tragic. And yet we spend fortunes looking at why relationships dissolve, instead of taking a few simple & inexpensive preliminary precautions.
Why is it that we put all that effort and money into the marriage ceremony – during which the bride was so stressed she only remembers via the miracle of video; the groom would rather forget because he merely played a supporting role to her dream; and the guests vaguely recall through an alcoholic haze? Yet we put so little effort into ensuring that our children are protected against the probabilities of life?
If you are not yet married please have an ANC drafted before you tie the knot. If you are already knotted, and it is via either of the two ANC methods have a drink on me and don’t sign any sureties please Ma’am, no matter how much he begs and pleads. They’re bad, and there are always alternatives.
But if you are married in community of property, then please read the next paragraph no matter how rosy the horizon seems right now.
Please set up a Trust immediately to create a safe haven outside of your communal estate that will be safe from any business adversity. However, you must do it soon.By the time you need this Trust I guarantee it will be too late to get its engine started in time. And if, God forbid, either of you has ever signed a personal surety in favour of a bank, landlord, or supplier then it truly is critical that you include a Trust in your immediate future. [That’s because if either of you has signed, it means that both of you have signed!]