Despite the fact that it’s now the norm for so many couples to live together instead of getting married, even if they have children, there are still a lot of myths around a person’s financial rights should they split up or if they are unexpectedly bereaved.th August 2018
Firstly, there is no such thing as a ‘common law’ marriage. Even if you have made a considerable or equal financial contribution to the family home, without your name on the deeds of the property you have no claim on it.
The number of people getting married has steadily decreased year on year, with a further drop of 3.4% in 2017. Cohabiting couples are the fastest growing type of family unit, more than doubling to 3.3 million as compared with just 20 years ago.
Geoff Newman, Development Director at leading Hertfordshire financial advice and financial planning firm Lyndhurst Financial Management says
“Many cohabiting couples are stunned if they split up to discover by law there are no automatically shared assets and basically they have no rights no matter how long they have been together or if they have children.
It’s an anomaly that in 2018 there is no sign that the law is about to change and I can’t stress enough how important it is for cohabiting couples to get independent financial advice to protect themselves and their children. You can get some legal protection with a cohabitation agreement which can help protect your rights while at the same time safeguard your individual interests and assets.
It’s also important for couples to be aware that if the main breadwinner, usually the man, dies unexpectedly, their partner cannot claim thousands of pounds in government support, whereas married partners of people who die are able to claim three separate payments on their passing, paid for from the late partner’s National Insurance contributions. They include a bereavement support payment, a widowed parent’s allowance and a bereavement allowance.
In the face of a sudden and dramatic loss of family income, these payments are essential for widows or widowers who are left to bring up the children. It can also pay for funeral and other costs. Sometimes the partner who is left also needs to take time off work.”
A study has suggested that co-habiting but unmarried couples may be missing out on as much as £82million a year, with £15million in bereavement payments, £11million in bereavement allowance and £56million a year in widowed parent’s allowance.
“There are approximately six million people in cohabiting relationships in the UK, preferring not to get married. It is always essential for couples, and especially those with children, to make financial arrangements in case they split up or if one of them should die unexpectedly.
Partners should always have wills and a Lasting Power of Attorney drawn up for the main breadwinner in case of unexpected accidents or tragedies. As a cohabiting couple you can’t even inherit your deceased partner’s pension. I think the laws around these issues need to be reviewed because such a large number of couples who have families choose not to marry, but until the law changes it is essential for co-habiting couples to get professional financial and legal advice on how to protect themselves and their families in the future.”