If you’re planning to move in with your partner or are already doing so, it is a good idea to consider entering into a Cohabitation (Living Together) Agreement. This is particularly important if you have very different finances to your partner and/or perhaps are divorced and are bringing some wealth into the relationship.
The Agreement sets out what happens with regards to financial matters whilst you’re together as well as what happens should you separate. The terms of the Agreement can be flexible. The types of issues 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?
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 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.
There are templates for the Agreement on the internet but I would strongly suggest that even if you decide to use one for guidance, the Agreement should still be checked and formalised by your solicitor.
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