by Ruth Barnicoat, Legal Exectutive Lawyer

 

25 June 2010

 

Moving in with your partner is one of the most exciting adventures of your life and it is the norm these days to “road test” living with your partner before deciding what the next step will be.

 

Basking in the bliss of love, you’ll be forgiven for not considering what will happen should your relationship turn sour or, God forbid, one of you dies.

 

When something goes wrong, cohabitants are not afforded the same protection as their married counterparts regardless of the length of the relationship.   There are a number of important, albeit less romantic measures to take to avoid the financial pitfalls you may face when a cohabiting relationship ends.

 

Firstly, make sure you have an up to date Will. This doesn’t need to be complicated, just a simple document clearly stating to whom you are gifting your estate.

 

You may rely on your partner’s income to pay the mortgage or rent but without life insurance you could find yourself homeless at a very difficult time. Consider taking out life cover payable to a beneficiary of your choice or if you have a pension nominate your partner to receive any payments due.

 

If renting, ensure that both names are on the Tenancy Agreement, protecting your right to stay in the property should your partner ask you to leave. You will, however, be accountable for your partner’s share of the rent should they default, unless you each have separate agreements with your landlord.

 

If buying, should you own the property as joint tenants or tenants in common? If joint tenants, one partner will automatically inherit the share of the other if he or she dies but, if tenants in common, each party can leave his or her share where they wish in a Will.

 

You may even want to consider entering into a Cohabitation Agreement, clarifying responsibilities and entitlements from the outset.

 

In the event of a break up, emotional heartache is horrible but financial loss can be devastating. So, set your finances straight now and be secure in the knowledge that you both have a back up plan !