by Stacy Francis, CFP®, CDFA
A sharp rise in the number of opposite-sex, unmarried couples moving in together this year may be less about romance and more about surviving in a struggling economy, according to a new report by the U.S. Census Bureau.
The share of couples who are not married has risen in many places but is highest in areas that offer many people grim prospects for a better financial future: old industrial cities and the Mississippi Delta.
Unmarried couples made up 12% of U.S. couples in 2010, a 25% increase in 10 years, according to 2013 Census data.
Two-thirds of the cities with the largest shares of unmarried couples were in the Northeast and Midwest, up from about half a decade earlier.
The couples in the study range from young couples living together before marriage to elderly couples living together for convenience, and about 10 percent are gay couples. These single couples face unique money issues, and are less likely to plan for their financial future than married couples.
In the beginning of a relationship it’s best to keep your assets separate, to avoid property disputes later. Be sure to have separate checking accounts and own as little joint property as possible. Beware, if you both contribute money to the purchase of a major asset, such as a house or a car, this will be considered joint property.
As the relationship grows and your income and assets begin to increase, you may want to hire a family lawyer to draw up an agreement that addresses what will happen to your assets if your relationship ends. You don’t need financial troubles in addition to the emotional turmoil of a failed relationship.
You may also want to put into place a durable power of attorney that allows your partner to make financial decisions for you if you’re unable to make them yourself.
In addition, a healthcare proxy (or durable power of attorney for healthcare) can be useful. This allows a non-relative to make medical decisions for you if you’re incapacitated.
If you want to leave assets to your partner at the time of your death you will also need to draw up a will.
These are only a few of the issues you will need to discuss with your partner. It’s difficult to have to think about these things whether you’re married or not, but it’s important!