Things to think about before moving in together

A lot of people choose to live together for various reasons. They might be taking their relationship for a test run, not interested in marriage or unable to legally wed. Whatever the reason cohabitating is more than being roommates or playing house.
Yeah there are all those issues of getting used to another person’s habits and personal quirks. But, you’ve also got to address financial issues such as how to divide the bills and what happens to shared assets if you split.

It’s in the best interest of both of you to accept these realities and make a written agreement. Who pays for what doesn’t necessarily need to be in a formal document. But it’s best if you put what happens to your stuff into a legal cohabitation agreement. Don’t assume that you’ll both be cooperative if you should break up or that your assets will be divided equitably.

It’s often a good idea to open a joint account that you’ll use solely for paying bills. You could just divide the bills and then pay them from separate accounts, but what if your partner isn’t able to or doesn’t take care of their portion. You’ll want to set up a direct deposit for each of you into the account. That way if one of you is sick, forgetful or for whatever reason unable to pay bills, the other can make sure that things get taken care of.

If you and your sweetie should fall in love with a house both of your names can be on the title. However, if you finance the majority of the purchase and later breakup, then without a prior agreement you may only get half the value of the home.

Cohabitation agreements aren’t just people who are wealthy. What they do is give you some of the legal rights you could be missing out on if you aren’t officially married. Hopefully you’ll never need to pull it out after it’s created, but besides breaking up there are other instances when it could come in handy. If your sweetie should become seriously ill, this is one document that could spell out how assets should be handled.

Here’s a good example of what a cohabitation agreement could look like. It doesn’t have to be drawn up by an attorney, but it’s a good idea get one to look it over. If one of you writes the agreement and it’s not reviewed by an attorney it could later be construed by a court against the partner who drew it up. And it’s best to use separate attorneys to represent each of your interests. This makes it more fair. Most states do recognize cohabitation agreements for either heterosexual or same-sex couples.

However you approach an agreement be sure that it is a written document. It’s much easier to be specific when it’s written.

Sure there is nothing romantic about dividing up bills and discussing your possible breakup, but creating an agreement is a healthy move for your relationship. It gives you the chance to clearly set out what responsibilities and assets you have. Which leads to honesty–Be Honest. Don’t hide assets from your partner. This could burn you later. If you’re bringing more to the relationship than your sweetie write it into the agreement. Make it clear that your inheritance from grandma or other money stash has nothing to do with this relationship–if that’s how you feel.

Hey December is Engagement Month. More couple’s become engaged in December than in February. And since this is a credit union blog–I’m going to take a look at the financials of love all week.


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