This month’s column by My Baba’s resident financial expert Miss Lolly looks into the financial implications of cohabiting, and the things you need to be aware of. 

Over 3 million couples are living together in the UK but aren’t married. My clients are often surprised that there is no automatic financial protection if things go wrong.

A recent study by AVIVA concluded that cohabitating couples are less financially prepared for the future than married couples. Here are some interesting stats that came out of their research:

  • Those living together but not married have almost half the amount of savings and investments held by a married couple (£2,688 Vs £5,157)
  • 74% of cohabitees do not have a will and 64% do not have life assurance
  • 1 in 5 cohabitees  believe incorrectly that that will benefit from their partner’s final salary pension scheme on death
  • Only 4% of cohabitees have a cohabitation agreement (see below for more information)

Here are the facts that you need to be aware of:

  • Cohabitees do not have the same legal rights as married couples. A really important consideration is that on the death of an unmarried partner, you will NOT inherit their property automatically. To protect yourself you need to write a will.
  • If your relationship breaks down and you are not married, you are not entitled to a share of your partner’s assets, nor do they have to pay you maintenance as they would if you are married. Ideally a cohabitation agreement to protect yourself. This legal document puts down in writing who owns what and can help financial loss should the relationship breakdown.
  • Cohabitees are much more vulnerable on the death of their partner than married couples. They do not get Bereavement Benefit and some pension schemes still will not pay out to unmarried partners. Therefore make sure that you have the right amount of life cover, critical illness cover and income protection

If this shocks you, please tell your friends!!

Lots of Love

Miss Lolly xx
Smart Financial Advice for Women

Whether you need help with mortgages, investing, saving for a rainy day, or just tackling your financial fears, Miss Lolly will give you unbiased advice based on the very latest financial wisdom. No jargon, no lectures – just the vital stuff you need to know, in user-friendly language. Get in touch via her website.

About The Author

Miss Lolly
Financial Adviser

After 8 years in her profession, the financial adviser behind Miss Lolly realised that most households, no matter what their income, face very similar dilemmas when it comes to money. Everyone wants the “good night’s sleep” that comes with knowing that everything is on track but very few actually take action and put a plan in place and seek good, regular advice. The main barrier is fear! Fear of not understanding, fear of not having enough money and most importantly fear of opening your eyes to the current financial situation. “The motivation to set up Miss Lolly came when I fell pregnant and started to think more seriously about my own financial future. I realised how lucky I am to have the knowledge and tools to put in place everything I need to ensure that my new family will be financially secure. I also noticed that a few hints and tips are all most clients need to restore their confidence to tackle their day to day finances by themselves. When helping clients with their financial foundations, I was being asked very similar questions, so thought it would be useful to share some of the advice that I give them.” By day Miss Lolly is a financial adviser at a wealth management firm in the City of London. She is a Chartered Independent Financial Adviser and also a Fellow of the Personal Finance Society (PFS). This is the highest qualification a financial adviser can hold and less than 2% of PFS members have reached this. Miss Lolly is also a member of MENSA – the high IQ Society with an IQ of 148. In her spare time, Miss Lolly enjoys socialising with her friends, trying out new restaurants, keeping fit and playing Sudoku. She lives in South West London with her husband and is the proud mum of two children.

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