Unmarried co-habiting couples are the fastest growing family type in the UK
The stats are out, and according to the Office for National Statistics, the number of cohabiting couples has increased by 25.8% in the last decade. Even the current Prime Minister is jumping on the bandwagon with this particular trend, but it’s important to be aware of how you can protect you and your relationship in this scenario.
Cohabiting couples do not have any specific legal rights and common-law marriage is not recognised under English & Welsh law, so it’s important to think practically when deciding to move in together, as well as enjoying the novelty of waking up every day with the main person in your life (and training them to bring you a cup of tea!).
Here are some pointers to think about before you move in with your beloved:
Jointly Owned Property
If you are purchasing a property together, you need to think carefully about how it will be owned. There are two ways to jointly own a property – joint tenants and tenants-in-common. Joint tenants means you both own the entire property together and tenants-in-common means you both own distinct shares in the property.
It is very common for people purchasing a property together to put unequal amounts into the investment at the outset. You may want to protect what you have put in the property in case anything happens in the future. You can do this by putting in place a Declaration of Trust which states formally in what shares you and your partner will own the property.
This might seem unromantic but it is incredibly practical and stops lengthy arguments at a later date should the relationship break down. And relationships struggle most when things haven’t been communicated clearly. Another great tool to assist in helping you communicate well is to have a defined co-habitation agreement from the outset.
Whilst not 100% legally binding, entering into a cohabitation agreement with your partner is clear retrospective evidence of your intentions at the time. Such steps shouldn’t be considered unromantic or cynical, instead it is a small investment which could potentially save you thousands if the relationship were to break down in future.
Provided you follow certain basic steps – such as undertaking disclosure, clearly acknowledging that you intend to create legal relations and take independent legal advice, your cohabitation agreement will hold significant weight should a dispute ever arise. This could be pivotal in avoiding complex and expensive litigation in circumstances where the relationship breaks down and you are left relying on Trust Law to establish and quantify your potential interest in the property.
A cohabitation agreement can also set out your expectations in terms of payment of the utilities, ownership of furniture etc and is not simply limited to your interest in the property itself. These documents can be as unique as you and your relationship!
Make a Will
If the worst happens and your partner suddenly dies, you may find it difficult to deal with the fall out because the law doesn’t recognise your relationship. The best way to have this recognised if you are not married is to ensure you have Wills drafted, appointing each other as Executors so that you have the legal right to deal with their Estate (i.e. everything they own).
Or, if you feel that getting married might be for you, then it could be a really useful tax saving tool, especially if your estates are over a certain amount. Oh, the romance!
Lasting Powers of Attorney
It’s a fact of life that people can get sick and have accidents that mean our independence and ability to make decisions for ourselves is taken away from us.
Most people assume Lasting Powers of Attorney (LPAs) are only for older people and only when dementia or other neurological conditions have become a reality for them, but illness and accidents can happen to anyone at any age.
As an example, 38% of first time strokes happen to 40-69 year olds. A head injury is the most common cause of death and disability under the age of 40 in the UK.
If you have moved in with your partner and they suffer an accident or illness which means they cannot deal with their own affairs or manage their own finances, who will manage this for them? If no one is appointed there is a long process through the Court of Protection for them to appoint someone – and you might not be the person appointed.
However, a Lasting Power of Attorney can be put in place just in case such an event happens. You and your partner can appoint each other to deal with things should you be unable to do so, so that at a very difficult time, the day-to-day can be made a lot easier.
And once you have dealt with all the boring, practical paperwork, it’s time to focus on the more fun aspects of living together, such as whose towel has been left on the bathroom floor…
If you want to make an appointment or discuss cohabitation further, call Trethowans free on 0800 2800 421.