Prenups: Not just for married couples anymore
Cohabitation agreements are on the rise, in case love doesn’t lastFrom: www.msnbc.msn.com
NEW YORK — Not all couples put a ring on it, but living together without getting married doesn’t preclude the possibility of a prenup-like agreement — just in case love doesn’t last.
A survey of divorce attorneys who belong to the 1,600-member American Academy of Matrimonial Lawyers shows 48 percent have seen a rise in couples duking it out in court over the past five years.
Of those, 39 percent report an increase in the number of cohabitation agreements that protect property and other assets for partners living outside the bounds of legally recognized marriages.
Rare in some areas of the country as recently as 15 or 20 years ago, such contracts are coming into their own, said Ken Altshuler, the group’s president-elect in Portland, Maine. “They’re really on the cutting edge of relationships today as more people move in together.”
The elite organization of divorce lawyers strongly advises cohabitation agreements for unmarried heterosexual couples along with same-sex partners whose unions are not legally recognized, especially when children are adopted by one but not both partners.
“To go to court to enforce your rights is just very expensive,” said Susan Bender, a Manhattan lawyer who routinely handles cohabitation agreements for same-sex couples.
“Otherwise there’s litigation, the hiring of an attorney,” she said. “It’s dispiriting to young couples to come into my office to begin their romantic relationship with figuring out who gets the IRA, but it makes so much sense.”
Linda Lea Viken, the group’s outgoing president in Rapid City, S.D., said cohabitation agreements can protect an unmarried person’s stake in jointly owned property like a house or a condo and guard against seizure for payment of spousal debt.
What if one partner buys a house and the other furnishes it? How will the purchase of groceries be handled?
“If we break up and there’s no agreement, I don’t have a claim,” Viken said. “The litigation between two people who own a house together and aren’t married is much more difficult than two married people who are getting divorced.”
About 30 percent of the attorneys who responded to the survey said a majority of cohabitation agreements they draw up are for same-sex couples. With only a handful of states recognizing gay marriage, the agreements can spell out legal rights both in and out of state. But most of the attorneys surveyed were executing the agreements on behalf of unmarried, heterosexual couples.
In recent years, fear over a partner’s debt pops up often among people asking Altshuler about legal shields outside of marriage.
“Most people who call me up who are cohabiting, they don’t think of it as a traditional prenup,” he said. “They think of it in terms of how do I protect my assets? Can they come after my share of the house because of his credit card debt?”
But the cohabitation agreements are not necessarily right for everyone.
Kelley Long is a freelance finance consultant in Chicago. She and her boyfriend, marketing executive Matthew Fenton, have been living together for a little more than a year. With help from the creation of a joint checking account, Long established standing as a domestic partner so she could qualify for health benefits through Fenton’s company-provided insurance.
The two sought legal advice on whether to execute a cohabitation agreement — he, to protect his much-higher salary, and she, to “just kind of delineate a division of duties, how things go while we’re together.”
They jointly signed a lease on the apartment they rent and Long wondered what would happen in the event of a default. She wondered, too, about the household bills, some of which are in her name and some in his. Ultimately, she said, they decided to skip the legal formality.
“It came down to, well, if I have to protect myself against this stuff, we probably shouldn’t be living together,” she said.
Word of the Day
Origin: Latin litigatus, past participle of litigare, from lit-, lis lawsuit + agere to drive — more at agent
First Known Use: 1615
1: to make (something) the subject of a lawsuit: to cause (a case, an issue, etc.) to be decided and settled in a court of law
Asset: n. something that is owned by a person, company, etc. —usually plural
Cohabit: v. to live together as or as if a married couple
Dispirit: v. to deprive of morale or enthusiasm
Execute: v. to perform what is required to give validity to
Individual Retirement Account (IRA): n. a retirement savings account in which income taxes on certain deposits and on all gains are deferred until withdrawals are made
Prenuptial (agreement): n. an agreement made between a man and a woman before marrying in which they give up future rights to each other’s property in the event of divorce or death —called also pre*nup, prenuptial
Seizure: n. the taking possession of person or property by legal process
Stand: v. to be in a particular state or situation
Idioms & Expressions
Call up: to communicate or try to communicate with by telephone
- Why don´t you call me up later and we could discuss the financial report in depth.
Come into (your/its) own: to be very useful or successful in a particular situation
- Cars are banned from the city center so a bicycle really comes into its own here.
Duke it out: to compete against someone or something
- The airlines are duking it out, offering better service and cheaper fares as a way of attracting passengers.
Pop up: to arise suddenly; to appear without warning.
- New problems keep popping up all the time.
Love those Phrasal Verbs
Come down to: to be reduced to something; to amount to no more than something
- When it comes right down to it, you have to admit he was mistaken.
Draw up: to devise or formulate; draft, especially in legal form or as a formal proposal:
- The lawyer will be by later on to draw up James´ will.
Figure out: to calculate; compute
- I´m going to have to figure out the budget for next year´s travel allowance based on the expenses of these past months.
Move in: to begin to occupy a place in which to live or work
- After my promotion, I was moved in to the infamous ¨corner office¨.