It is very common for couples to live together before (or instead of) getting married. It is important to think with your head as well as your heart before planning to move in with your partner.
Both parties need to be to be smart about their finances. This avoids falling into problems later on if the worst happens and the relationship fails.
Statistics show the most common ground for couples living together to split up, is arguments over money.
It may seem strange for a Divorce and Separation Consultant to be providing advice to happy couples planning to move in together. I, of course, see the other side of things (i.e. when things have gone wrong). I am therefore familiar with some of the factors that can cause problems in the relationship…
Here are my 2 top tips for couples to consider before the move in together:
1. Be Open With Each Other About Your Finances
It is important to make sure you have a very clear understanding of your partner’s finances. You can’t be shy about this. Find out about their spending habits, debts, and their thoughts on how your accounts will be dealt with once you live together- i.e. will they be joint or separate? The sorts of questions you should be asking are….
- How much money do you earn?
- What are your assets and liabilities?
- Have you ever filed for bankruptcy and are there any court judgments against you?
- Do you pay child or spousal maintenance?
- If we purchase a home or make other investments, will these be held jointly?
- What about assets and liabilities built up before the relationship – will they also be shared jointly or will they remain separate?
If your partner owns a business or professional practice, make sure you understand its revenues, expenses and net income. Does the business have assets/liabilities? Are they personally liable for the liabilities?
2. Think About Getting A Cohabitation(Living Together) Agreement
A Cohabitation (Living Together) Agreement regulates a couple’s affairs during and/or after separation. The terms of the Agreement can be flexible. The types of issue which should be included are:
- Outgoings– who is to be responsible both pre- and post- separation
- Property– how this is owned and the beneficial interests; how it should be treated on separation; contributions to upkeep and maintenance.
- Joint Accounts- contributions and restrictions on spending.
- Assets- ownership and entitlement on separation- e.g. cars, furniture, etc.
- Debt- who is to be responsible during the relationship and on separation.
- Maintenance- will any be payable on separation?
- Financial provision for children- including maintenance and school fees.
To do this properly, the Agreement should be drafted by a solicitor and you and your partner should have legal advice before you sign the Agreement.
I appreciate, that thinking you will ever split up is the last thing on your mind when you are “loved up” and looking forward to moving in together. It is however, sensible for both of you to be clear on each other’s finances, and how everything is to be approached as a couple. If you stay together, you’ll each know where you stand on important issues. Likewise, should the worst happen and you separate, you will already have set out the arrangements for the separation which avoids unnecessary arguments and further upset trying to sort things out.
For more information about living together or things to consider if you have separated from your partner, please get in touch with me here
If you have found the tips in this blog useful then you will find lots more in my ebook “Tips for Coping with Divorce” which you can download here: free ebook.
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