Financial Implications of Singles Living Together

There has been an increase in the number of single couples staying together since 1985. These couples staying together face financial issues such as they collectively cannot plan their future as a married couple can, there are a few issues illustrated below:

1. Single Couples and Mingling Assets

  • When two singles staying together it is best to keep the personal assets and financial goals separate to avoid conflicts when departing.
  • It is also advised to maintain different savings and checking accounts.
  • If you are in any plan to hold some property or asset together it better be a small one. It would be better not to invest in large property or asset together and even if you do so make sure it is the name of the two of you.
  • To pay common expenses you can choose to maintain a common checking account and contribute equally or in proportions to your salary.
  • In joint ownership of an asset you both are the owners and if one of you dies then the property is transferred to the others name. In tenants both of you own half the property and the beneficiary of your half can be the person of your choice.

2. Single Couples and Taxes

  • Single couples hold their advantage over the married couples according to the federal income tax. This is because they are avoiding the marriage tax penalty, however it would be ruled out within a few years.
  • When your income is under threshold and you can support a dependent then you can claim the head of the household, it allows you to take a child and credits for taking its care.
  • When you think to share your expenses without making it legal, it would make it a tax free sharing of resources.

3. Single Couples and Health and Financial Issues

  • If you are unable to make financial decisions then you can issue a power of attorney that enables your partner to make financial decisions for you. It is known as durable power of attorney.
  • If you are incapacitated or cannot make a decision then you could issue a health care proxy which allows your partner to make medical decisions for you.
  • You can issue a will that would make your partner in position of your property or any other asset, incase you are dead.
 

  • Behnam 12:01 pm on July 4, 2009

    I agree with everything you have said, and there is one part which I could NOT agree with you more. I’m not currently in a relationship, but I’ve been people around, and I agree that couples should keep their personal goals and financial assets completely separate. Not doing so can lead to conflict, and I have seen that first hand.