The 8 Things I Wish I Knew About Starting a Business After Divorce

Starting a business after divorce

There are several reasons for wanting to start your own business. Some do it for autonomy and flexibility. Some do it for personal challenge and development. Some will entertain it because it is the next logical step in their career. Some of them always had an unsatisfied urge to be their own boss. Some have had a hard time finding a full-time job due to a layoff or downsizing and are forced to test their entrepreneurial instincts as a means of making an income. Regardless of your reasoning to want to go into business for yourself, doing so after a divorce can be especially tricky. Here are many things to consider before you make that leap into the entrepreneurial pool.

1. Time

One of the appealing aspects of venturing out on your own is the perception of having greater flexibility with your schedule. Although this may be true in theory, the reality becomes that you’re responsible for being the chief strategy officer, marketing aficionado, business developer, accounts payable and receivable, and an entire host of other responsibilities that we don’t necessarily take into consideration. It’s effortless to have your entire day evaporate, performing some of these menial yet necessary tasks.

If you have kids, depending upon your parenting arrangement, you need to prioritize the time you spend with them, especially when they’re younger.

2. Be Passionate About What You Do

Chasing greater flexibility or your first million-dollar paycheck can be a great incentive but not if you don’t love what you do. Don’t leave a decent paying job only to fall into another job with a lot less job security and make you feel handcuffed in what you can do and where you can go. A good benchmark for this is would you be prepared to do what you’re doing for free? Love what you do first and foremost, and the money will follow.

3. Be Mindful of Cashflow and Working Capital

How much time will it take you to start making money with your new business? Now double your expectations. The reality is, most business owners underestimate how long it takes to start generating income. It can be mentally deflating to see your bank account continually dwindle when you start up a business. The reality is that most business owners seriously underestimate how long it will take to start generating revenue. When you have a lot more money going out than coming in, it can take its toll on your financial and mental wherewithal. You need to remain optimistic yet be conservative in your estimations when you start the journey towards profitability.

4. The Bank is not your Business Partner

Many think they can go to a bank to get a business loan or increase their working capital. While that may be true, the banks will not do so without having some form of personal security like guaranteeing your home. While banks will compete vigilantly for your business, they will not take uncalculated risks.

Many business owners have a love-hate relationship with banks. They are there offering you the world when you don’t need their cash, and they’re nowhere to be found when you do need their cash.

5. Sole Proprietorship or Corporation?

While there are pros and cons to both structures, you don’t need to make that decision out of the gate. Operating as a sole proprietor isn’t a bad option while you gain your wings as a new business owner. If you’re looking at growing this into a multi-national conglomerate at some point, you may want to consider incorporating sooner than later.

There are some greater tax advantages in incorporating, but you also have to deal with a separate tax filing and adds a layer of cost and complexity that you may not need out of the gate.

6. Business Plan = Business Budget

Your business plan is your template for what you envision as your business offering. This often becomes a malleable document that needs to accommodate change and flexibility. One of the most important aspects of a business plan is an anticipated budget. Given that you likely will be cash deficient for the first number of months, it’s important to predict with some degree of accuracy what your cash flow will be like until money starts coming in.

7. Be Mindful of your Mental Health

Although running your business can be truly exhilarating, not being prepared for the physical, financial and emotional demands it can place upon you can leave you feeling anxious and stressed. Being in a constant state of overwhelm can be debilitating. It can make even the most simple tasks difficult to accomplish.

Even though stress is often not avoidable, ensure you prioritize your health by exercising regularly, eating properly and having a close friend to lean on when times appear unbearable.

8. Having a Mentor

It’s been said that the life of a business owner can often be a lonely road. There likely will be a lot of questions that you may be unprepared for. It’s important to have a resource network that you can turn to in those times. They may not have all the answers, but it may give you a necessary sounding board on those days of overwhelm, feeling deflated or just needing reassurance that you’ve made the right decision in going into business for yourself.


As exciting as the prospect of starting your own business may be, doing so as someone who is divorced can add a whole other layer of complexity to the equation. You don’t have the luxury of a spouse’s salary to rely upon as part of your fixed income. Your time will be divided between your new business and your newly divorced life which will often entail children. You will experience some high highs and quite a few low lows. Many people think an entrepreneur’s life is filled with opportunity and lining your wallet with an infinite amount of money. The reality is, there is a considerable amount of risk and uncertainty that one must take on and must feel comfortable in feeling uncomfortable for an extended period of time.

Chris Coulter is the Founder and President of The Finish Line Group.  He works with business owners to leverage their businesses to increase their wealth, reduce corporate and personal taxes, create viable succession strategies, enable employee retention strategies and allow them to exit their businesses on their terms. 

Chris’ passion for what he does evolve from the mistakes he made in his first business; by not diversifying his risk and not utilizing many opportunities within his business to create significant wealth.  Chris found out the difficult way and now educates business owners on avoiding many of his former oversights and ultimately controlling where their finish line ends.

Originally posted for Shulman & Partners, 2019

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