You and your bae have been pushing it steadily for a while and you feel that it is now time to take the relationship to the next level. What’s the right step to take? Or should you get married? Should you cohabit before marriage? The choice is all yours, but before you make that decision, consider all the financial implications.
In this day and age, many couples choose to cohabit before marriage due to various reasons. Some believe that it’s better to “try it out before committing”, and others choose to do so for economical reasons. Whatever your motivations, if you choose to cohabit, think very carefully beforehand about how you will combine your income and expenses. Being in love and investing in joint assets is great, but should things get ugly, know how to navigate through the situation.
Consider the following 5 things:
Be honest. Speak about how you will share expenses and responsibilities. Know your deal-breakers and absolutes. Compile a list of these things and if you find that you agree on most things than not (considering the relative weight of each point), then chances are, you’re good to go.
Have your ducks in a row. Just because your bank statement looks good right now doesn’t mean you have to buy a townhouse in a luxury estate just yet. Know your combined income and savings situation to help you determine whether to buy or rent, when and where. Thereafter, create a budget and stick to it.
Draw up legal documents. This will help to protect you in the case where you might have to split up or in the unfortunate case of death. A co-habitation agreement may assist in the case where you have shared all expenses of a property with your partner, but when they pass away, you find that in their will they left the property to their parents. Know what is due to you through Donations Tax.
Keep separate accounts. Should anything happen to your significant other, you will need to have access to your joint funds. The complication of needing two signatories when not married will prohibit you from accessing funds alone, which may leave you in enormous trouble.
Control your emotions. Finding your dream apartment can be an emotional process and often couples end up fighting over which one to choose. Remember that any decision made while in an emotional state may lead to regret. In that event, cool down, and postpone your search for another day. Do contact a real estate agent to assist you with your search. Remember, if need be, they will be your therapist too.
Moving in together is a HUGE and somewhat permanent step. When done right it can fill your days with great joy and contentment. When done wrong, it can be the bane of your existence. Think carefully.