It's no secret that more and more unmarried couples are living together than ever before. But while it may sound romantic to move in with your partner, be aware that it can create some complicated financial situations. People in long-term relationships often pick up and share pricey assets like houses, cars and retirement plans along the way. Yet while the law says plenty about the financial affairs of married couples, it's mum on those who haven't had the clergy's blessing. So if you're not married and the relationship comes to an end, or worse, your partner unexpectedly dies, you could very well end up with nothing -- unless you take care of matters now.
That means paying careful attention to legalities such as property titles, wills and beneficiary designations. "If you're married, you get everything unless you opt out. If you're unmarried, you get nothing unless you opt in," says Frederick Hertz, an Oakland, Calif.-based attorney and author of a legal guide on living together. And certainly, more people than ever are finding themselves in such a tough spot. Between 1980 and 2000, the percentage of unmarried adults living together in opposite-sex couples nearly doubled, from 6.5% to 12.6% of the population, estimates Philip Cohen, a demographer and sociologist at the University of California (Irvine). That percentage would be even higher if you count same-sex couples (where reliable stats are harder to come by). Given the surge in the number of nontraditional couples, a few states have passed laws expanding their rights, including Vermont and California. This year, for example, California made it easier for registered domestic partners to have a say in each other's medical decisions. It's also made such couples eligible for certain unemployment benefits and income tax deductions that had been reserved for married couples. Meanwhile, in Vermont, same-sex couples entering into a civil union can automatically inherit property from each other in the event of death. Nevertheless, in most cases, the burden is still on couples to look out for each other. Below, we explain a few of the best ways to protect you and your partner financially. your partner could lose access to property even though the title says it goes to them. But if a will confirms it and says the same thing, it's very difficult to challenge."