Sorting Out Finances for Cohabiting Couples

If you are living in a de facto relationship, as many other couples around the country are, you might think that there will never be need for lawyers. After all, without the formal agreements that come with marriage, everything you own is yours alone, right? This is a dangerous way to think, because you do not need to be married to be at legal risk, when it comes to your finances.

Couples who have been classified as de facto have a lot of the same rights as married couples, when it comes to separations. In fact, property settlements are largely similar, whether you are married or just cohabiting. This can even extend to the division of superannuation, and spousal payments.

Many people are not aware that they are living in a de facto relationship. When two people are in a relationship, and they live with one another in a domestic sense, they can be considered to be de facto. However, it does get a little more complicated than that. Couples who are not actually living together full time might still be de facto. When at least one person in the couple is still married to another person, or one or both of them are part of a de facto relationship with another person — they can still be considered de facto with the first mentioned person.

Whether you are technically living with a person, is not the only factor that a court will look at with separation settlements. They will also consider the nature of the relationship and cohabitation, how long the couple was together, if there was any sex between them, whether or not they shared finances in a dependent or even co-dependent way, how property was purchased and used, if there were any children involved and who cared for them, and how the public saw the relationship.

You might believe that your current relationship is not “formal”, because you are not technically living together. Many couples believe that maintaining their own homes, and simply seeing each other, will save them from legal problems. Such couples can be sure that there is always a chance for lawyers to become involved, where there is any evidence that a couple was “together”.

When a couple has never lived together, there have not actually been any cases where they were ruled to be de facto. However, it is clear that simply living together is not the only factor that comes into play. While a couple is not married, it is still possible to protect assets with a binding financial agreement. This might seem unnecessary when both parties are happily together, and suggesting such a thing can be enough to cause trouble with a relationship. However, assuming that an informal agreement will protect your assets is a great way to see yourself lose a court case. It is often best to have a formal and legally binding agreement drawn up. This is especially the case where one member of the couple has large assets going into the relationship, or where one person contributes much more than the other.

If you would like to guarantee that your partner can never take away assets that you worked hard to obtain, consider getting some legal advice as soon as possible. It is better to be safe, than to assume that cohabitation means “what’s yours is yours”.