Cohabitation between couples is the new marriage. According to the 2000 census, over 11 million people live with a partner or significant other. These living arrangements work out well for millions of couples. But when the relationship turns sour, things can get pretty complicated. Not protected by marriage and divorce laws, there are no rules for separating jointly owned property and belongings.
Newsweek recently published an article about the financial challenges cohabitating couples face. Along with discussing financial goals before you move in together, the article also suggests that couples create a domestic partnership contract or "cohabitation agreement" and have it notarized. In the event of a breakup, this contract will act as a replacement "prenup" and make the transition go more smoothly.
As for your credit, it’s best to keep your credit cards in your own name when you are cohabitating with your sweetheart. If you do open a joint account, keep in mind that the account details are reported to both your credit reports. If you buy a home with your partner, be sure to work out the ownership details in a formal contract before you sign the mortgage papers.
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