Can you save money cohabiting?

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These days, many couples opt for living together and marriage is not as standard as it once was. By living together, as opposed to in separate houses, couples can make great savings on living expenses. As many readers will know, my husband and I had the big elaborate wedding and we don’t regret it for one moment. However, we felt it was something we could afford, whereas many couples find the expense off-putting.

There are pros and cons to both marriage and cohabiting, and both can be the perfect union, given the right consideration and care.

Costly ways

Weddings can be expensive, and many people just cannot justify the expenditure when they feel the finance could be better used elsewhere. Our wedding was everything we dreamed it would be, and we both have the jobs in place to pay for it, and we plan only to get married once! In the eventuality that the marriage hits a tight spot that neither party can see their way out of, getting legal advice for settling the end of a marriage can be costly and extremely upsetting for both parties.

What’s in a name?

Not getting married means not feeling the pressure of changing your name. Whilst many couples do not do this these days anyway, and we are in the age of double barrelling, there is something pleasant about keeping one’s name, as well as individuality. Getting married ought to be a union in which both parties thrive, whereas anything that is seen to be constrictive negates this. Keeping the freedom to have your own name is a benefit to staying as cohabitees. Similarly, if you do wish to take the name of your partner, you can do so by deed poll and avoid the marriage element altogether.

Think about Tax

Whilst taxes and their benefits are hardly the most romantic thing, they are an argument for marriage, as there are many ways in which taxes work with marriage laws. For example capital gains tax can be used to your advantage by transferring ownership of an asset between spouses, making savings and manipulating tax brackets. If two spouses have paying jobs in the two different tax brackets, then they can transfer ownership between the two to make savings of at least £10,000. This makes having the elaborate, once-in-a-lifetime wedding suddenly seem for feasible for some. Unfortunately, cohabitees cannot use the same strategy, as charges would apply in this instance.

Giving your spouse rights

Write a will. If you don’t already have one, this is an essential way to make sure that your cohabitee is covered if anything happens. By law, cohabitees are not given automatic rights to their partner’s estate, so this means if you want to make sure the other is covered, you will need to have this written. This is inexpensive, and is a way to protect your loved one, without going down the marriage route and could save cohabitees money in the future. This is an instance where marriage protects you, and cohabiting requires a little more planning.

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