Last month we discussed a few issues that couples should consider when they begin to live together, but don’t plan to or anticipate getting married very soon. This month, we will look at some other important life decisions which may have a huge impact on people’s lives and relationships:
5. Medical Insurance. As we covered above, living together does not equate “married” especially in the eyes of a medical insurer. Do not add your long-time, live-in girlfriend to your medical insurance as a “spouse.” The rationale that “everyone at work thinks we’re married” will not keep you from being sued by the insurance company when you eventually get caught. You just committed fraud and insurance companies have lawyers by the thousands to make sure you don’t get away with it.
If you need to find a way to get coverage, check with your insurance company and your benefits administrator. Same-sex couples have actually paved the way for committed straight couples in some companies and in some Pennsylvania municipalities to obtain coverage on their partner’s benefits.
6. Beneficiary Status. Retirement and investment accounts allow you to designate beneficiaries on retirement accounts in the event you die. If you pass away without designating a beneficiary, the plan administrator will then follow either Federal law (i.e. ERISA) or your state’s probate laws for the estate. Without designating your partner as the beneficiary of your account or on an insurance policy, there is no way the state or the plan administrator will issue the proceeds to your partner; in the eyes of the law and the plan, your relationship to you may as well not exist.
7. Emergency Contacts/Next of Kin. Stories have circulated in the media where a partner is barred from a hospital room because he or she is not the patient’s next of kin. Estate planning documents such as a durable power of attorney or living will can help ensure that a partner is afforded the access they need, while identifying your partner on emergency contact forms with your insurance company will only bolster the paper trail confirming their role in your life.
8. The Break-Up. Getting all of the above in line will help plan for emergencies, contingencies, tragedies, and the peaks and valleys of a life together. It also means that you have to undo all of it if the relationship ends. This may be the single greatest deterrent to people from undertaking these tasks in the first place. Yet, what is the alternative? Protracted litigation with your partner’s family over beneficiary rights to a retirement account? A battle with your ex-partner over who gets to stay in the house; who pays the mortgage; will the house be sold or can you be bought-out?
The ugliness and long legal fights that can arise from each of these points should be sufficient justification to put aside the fear of difficult conversations or putting too much pressure on an otherwise satisfying relationship. Spend a few hours honestly discussing these issues and understandign what both people need to feel secure in comingling lives and finances. Once you have your plan together, you can move on with living your lives. There may even be the added benefit of silencing the (sometimes) well-intentioned, but (always) nosy comments from your family about your relationship’s "stability."