Tag Archives: wills

Marriage rate at record low: 10 risks we take when we live together

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  • The marriage rate of opposite sex couples was the lowest on record in 2018, with 20.1 per 1,000 unmarried men and 18.6 per 1,000 unmarried women.
  • In the previous 10 years, marriage rates had fallen most among those under the age of 20: down 57% for men and 63% for women.
  • The average age to get married is rising – in opposite-sex couples, men married at an average age of 38.1, and women 35.8 years.
  • There were 234,795 marriages in 2018 – down 3.3% from 2017.
  • Since 1972, the annual number of opposite-sex marriages has fallen 46.5%.

The Office for National Statistics has published marriage statistics for 2018 today.

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Sarah Coles, personal finance analyst, Hargreaves Lansdown

“Marriages hit a record low in 2018, as more people decided it was better to live with their partner first for a few years than live with a bad decision forever. But as more couples move in together for longer without tying the knot, they need to understand the ways it can make them vulnerable.

Separate ONS statistics show that among those under 30, more than two thirds of couples are living together without getting married, along with one in five couples in their 40s and one in ten people in their 60s.

There are all sorts of reasons why people choose to marry or live together, and nobody would suggest marrying for money. However, if you are living together you need to understand the financial risks you face. You could be in for a horrible surprise if you split up, or fall foul of rules you never knew existed if your partner was to die.

The good news is that you don’t have to rush into marriage to protect yourself, because there are steps you can take to cut your risks, whatever your marital status.

10 risks of living together

  1. If one of you dies without a will, the other could get nothing. If the home is in their name, you could lose your home too, because everything passes to your partner’s children. If they have no children, everything in their name will pass to their parents instead.
  2.  If you have a pension which is meant to pay out to a spouse when you die, some pensions don’t allow this to be left to an unmarried partner. Some will allow you to complete a ‘nomination of beneficiaries’ form, to ask for anything to pass to your partner, but if you don’t complete the form there are no guarantees that this will happen.
  3. If you have children, the father isn’t on the birth certificate, and the mother dies, the father doesn’t automatically have a right to care for the child.
  4. If one of you dies and leaves everything to the other, in a marriage or civil partnership this would all be free of inheritance tax. If you’re not married and you breach the inheritance tax nil rate band, there could be tax to pay. In some cases, this could mean you can’t afford to stay in your home.
  5. There are no inheritable ISAs. If your spouse holds an ISA on death, you will get an additional ISA allowance – called an Additional Permitted Subscription, which essentially means ISA assets they leave you can all be wrapped up in an ISA again without affecting your allowances. If you’re not married, you don’t get this extra ISA allowance.
  6. If you split up and one of you owns the house in their name, the other may have no right to live in it or to a share of the property.
  7. On the flip side, if the property belongs to one of you entirely, but the other has contributed towards it in some way – including paying a share of the bills or helping with home improvements, they can claim an ‘interest’ in it, and go to a court for a share of the property. It means couples who move in together may have made a bigger commitment than they appreciate.
  8. If you split up, and one of you has sacrificed their career for caring responsibilities, they have no right to spousal maintenance. On average, women’s pay falls 7% for each child they have – so without maintenance to make up the difference, this could leave them thousands of pounds worse off each year.
  9. In the event of a split, if one of you has a sizeable pension and the other has nothing, there’s no compulsion to share.
  10. There are tax disadvantages. We all have a personal allowance that’s not subject to income tax, a personal savings allowance, a dividend allowance and a capital gains tax allowance. Married couples can share assets between them to take advantage of both people’s allowances, and the lower taxpayer can hold the balance. If unmarried couples try to do this, sharing the assets could trigger a tax bill.

How to protect yourself

Make a will

The only way to ensure an unmarried partner inherits is to draw up a will so that your assets are left exactly as you want them. While it’s vital that everyone makes a will, the stakes for unmarried partners are even higher.

Think carefully about how all assets are owned

If one of you moved in with the other, and the home remains in their name, have you contributed financially? Financial contributions can be reflected by switching to own the property as tenants in common. This allows the financial contribution to be reflected accurately in the proportions of ownership. Also think before taking on any debt: if the loan is for the benefit of both of you, it should be in both names. And consider your savings, if you’re saving together, it should be in both names.

Consider a co-habitation agreement

This will lay out all kinds of things, from how you manage money between you to who owns what in the relationship. It can also iron out what will happen in the event that you split up.

Ensure both parents have parental responsibility

Fathers can protect themselves by being there when the birth is registered, and being on the birth certificate. If it’s too late for that, you can agree parental responsibility between you and complete the form . If you can’t agree, you may need to go to court.

Take out life insurance

Both of you should have enough insurance to ensure the children are provided for in the event you die. After a split, the resident parent should have cover and if one of you is paying child support, they should have cover that will replace it in the event of their death.

Build a nest egg for your child

One of the best ways to protect your child against whatever the future holds is for them to have savings and investments in their own name. The Junior ISA can be a really sensible option. Nobody can access the money until they are 18, and at that point it belongs entirely to the child. While the money is saved or invested it grows free of tax, and there’s no tax to pay when it’s withdrawn either.”

  • There were 6,925 marriages between same-sex couples, of which 57.2% were between female couples.
  • 803 same-sex couples converted their civil partnership into a marriage.
  • 21.1% of opposite-sex marriages in 2018 were religious ceremonies, the lowest on record.

 

New Infographic Gives The Grave Facts About Dying

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Dying is not something most of us want to think about. Problem is, it is unavoidable and not dealing with your affairs in advance can cause trouble for loved ones. While life insurance isn’t something that most would want to talk about, it’s rather important so those left behind won’t get into debt. Dealing with grief is hard enough, but according to this brilliant infographic which outlines the associated costs of funerals; 44% of people had to take out a credit card to pay for a loved ones funeral. Even worse, 27% had to resort to a payday loan. Having a child was the catalyst for myself getting my affairs in order, but this infographic shows that most of us are still woefully underprepared for the inevitable.

Assumptions don’t help either. Apparently 41% of people think that existing funds will cover their funeral costs, but the truth is that only 22% of people have the proper life insurance in place. Even more shocking is that only 32% of people have a will should something happen to them.

Over 50 life cover is important and helps to alleviate the financial strain that often comes with arranging a funeral, as letting those left behind know how you would like to be buried (or cremated), who you would like to leave your worldly goods to and any other last wishes. This funeral planning infographic from British Seniors Insurance Agency has lots of interesting statistics: average funeral costs are cheaper in Edinburgh and most expensive in Sheffield. Londoners are more likely to take out a credit card or payday loan, and Liverpool had the highest number of respondents wanting a religious ceremony. Different regions had different worries: Londoners were more likely to take out a credit card (40%) or a payday loan (39%) to pay for a funeral, while in Brighton 17% of people worried about future inheritance disputes among family members.

The thing about the costs are that they can catch you unaware. 31% of people said they did not know what costs to expect before  they started planning a funeral. If you are lucky enough to have never planned a funeral then you will be blissfully unaware how expensive they are. The average funeral in Edinburgh is £3,947, but the average cost reaches a dizzy £5,469 in Sheffield. Londoners meanwhile pay an average of £4,543. A staggering amount of money, even for the cheapest funeral, and one that relatives might struggle to pay for.

The infographic shows that being prepared is important, but some of the findings are interesting and amusing. When it comes to the send off, 55% wanted to be buried, 22% wished to be cremated and 20% remained uncertain. However, a staggering 70% of respondents over 55 wanted to be buried. A lot of people thought creatively when it came to their final resting place. Some wanted to be buried at their favourite sports ground, some wanted to be buried in a haunte

d house, others wanted to be buried near or in the sea, while some people wanted to be buried with their spouse or their dog. No mention of other pets though.

Check out the infographic by British Seniors Insurance Agency life insurance quote provider out for yourself. Hopefully it will spur you to get your affairs in order.

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How To Make A Will

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how to make a will - free willOne thing that often gets put off in life is creating a will to protect our families. 2/3 of people in the UK don’t have one; a risky choice for parents in particular, whom, once giving it some thought, would doubt like to ensure they protect their children and partners for peace of mind.

We got Mark Edwards, Vice President and General Manager of www.rocketlawyer.co.uk, to talk us through creating a will. Rocket Lawyer is a complete online legal service.

Mark says:

“Two thirds of the population don’t have a will. Lots of people don’t have wills because the law is daunting, by offering our services online, Rocket Lawyer gives people more control and choice, providing legal help that is simpler and easier to access at a lower cost.”

The new year is the perfect time for parents to bite the bullet and create one. Making a will may seem like a difficult and costly process but there are now great online legal services which simplify the process and make it really affordable, giving you peace of mind that everything will be taken care of according to your wishes, should the worst happen. A will covers appointing executors, guardians for your children, legacies and what will happen to your estate and possessions. Failing to make a will can have consequences which can cause serious problems for you and your family.

Benefits:

Protecting your partner

You might think that when you die, if you are married or in a civil partnership, your surviving spouse or civil partner will automatically receive all of your estate. However, this is not the case. If you die without leaving a will, there are legal rules, called the ‘intestacy rules’, which dictate which members of your family will receive your estate.

Rocket Lawyer recommends connecting with an On Call Lawyer when dealing with matters concerning personal assets valued at over £325,000 or combined assets with your spouse or civil partner valued at over £650,000.

If you are not married or in a civil partnership and you do not have a will on your death, your partner will not be entitled to anything. Even if you have joint bank accounts with your partner, or a home, any jointly held property will not necessarily pass onto your surviving partner.

So here is the overarching golden rule: it’s best to take control of your estate by making a will.

Nominate Executors

Executors are the people who will carry out your wishes after your death. Nominating your
executors means you can select reliable family or friends that you know will be best capable of fulfilling your requests. You can have up to four executors and they can also be beneficiaries of your will. Their roles are sensitive and personal but making a will ensures these responsibilities are managed by people you trust.

Executors make your funeral arrangements in accordance with your instructions. They work out what your estate is worth and decide whether or not there is any Inheritance Tax to pay on your estate. They apply to the Probate Registry for the Grant of Representation of your will. A Grant of

Probate is a document from the Family Division of the High Court which confirms that your will is valid and that your estate can be wound-up in accordance with the terms of your will.

Look after your children

Once you have decided who you would like to be your Executors, you then need to consider whether or not you need to appoint guardians in your will. Testamentary guardians are people who will look after your children if any of them are under 18 at the time of your death. They take over the role of parental responsibility for your children.

If children inherit money and/or property, it is usually held in a trust until they are 18. Specify how you would like trusts to be managed, your nominated executors can deal with this fund.

Remember to follow the signing rules

Once you’ve made your will, you need to follow some rules about how to formalise it. The execution of your will requires three people, yourself and two witnesses.

In the presence of your two witnesses and in the spaces provided, you should date the document and sign your name using your “usual” signature where indicated whilst your witnesses watch. Ask your two witnesses to add, in your presence, their “usual” signatures where indicated, asking them to print their names, addresses and occupations clearly for identification purposes.

Anyone over 18 can create a will for free with Rocket Lawyer’s three day free trial, during Free Wills Month and all year round.