Living together once the relationship is overing and managing finances

adamjth

Hi,

I am married have two children and since last November my partner and I have separated without either of us wanting to have a reconciliation. I have moved up into the loft room and life continues as my son is just starting secondary school I don't want to upset him by moving out in the foreseeable. The other factor to this is I cant afford to move out, pay rent and mortgage on the present property. So today we discussed the possibility of continuing to live like this longer term whilst we adjust to the new situation. My main problem with this, besides the complications of either my wife or I meeting another person, is that I don't know what differences this makes to finances in the long term. OK I know that the equity in the house will be split 50/50 but what about other sources like inheritance and pensions? Personally now that we are not together I don't want to benefit from any inheritance my wife might make and likewise any inheritance I might get but I am not sure how the law views this?

BTW this is not me, or my wife, being cold and calculating. I am 48 and want to be clearer about the implications of this now rather than later in my 50s when it will have ramifications for what property I can afford in retirement. I guess I need to go so see a marital solicitor but any incite or comment is welcome

thanks

Adam

adamjth

meant to read "Living together once the relationship is over and managing finances"

chesky

For you to be accepted as not being in a relationship together, you have to create separate households, even whilst living under the same roof. This means not eating or shopping together, each doing their own washing, ironing and cleaning. Obviously no sex and keeping separate finances.

TBagpuss

OK:
- assuming you jointly own the house, check whether you are joint tenants or tenants in common, and if you are joint tenants, sever the joint tenancy. (this means each of you has a distinct share of the house, which you can leave by will, rather than the house automatically passing to the survivor when one person dies)
- make or update your will. If you have no will, then your spouse would inherit the bulk of your estate, even if you are separated. It you have a will already update it to reflect the new position.

- check out the beneficiaries on any life insurance, pensions etc, and change them if you want to

Longer term, start to think about a divorce, which allows you to have a formal, binding financial settlement.It is perfectly possible to have an order which provides for things to happen in the future not immediately (so you could agree on an order which provided for the house to be sold in a year, or two years, or when one of you wants to move out, or when your son turns 18, or whatever you both agree on.

Alternatively, you could have a Deed of Separation now (which is an agreement between the two of you about your finances, usually including an agreement to divorce and to confirm the arrangements in an order in any divorce.

The two of you are free to deal with the finances how you want, but if you can't agree and a court was deciding things then the *starting point* is a 50/50 split but the aim is to be fair to you both, taking into account all the circumstances, including things such as your respective earning capacities and housing needs. So, if your wife earns more than you, it might be fair for you to have more than 50% of the equity to take into account her higher mortgage capacity, for instnace, and vice versa.

If your were to move out, you would not automatically have to continue to pay half the mortgage, although if your son was living with his mum you would have to pay child support.

It can sometimes be worth looking into whether your mortgage lets you take a payment holiday or change to an interest only basis to allow you both to work out what you can each afford, and to see if you can (jointly) save enough for one of you to be able to move out, pay a deposit etc.

Check out the 'entitled to' website to see whether either of you would be able to claim any tax credits or benefits.

And do plan to discuss what the long term plans are - save hard so you can sell the house and both afford to rehouse? Plan for one of you to buy out the other?

And do speak to a solicitor to get some specific advice based on your situation

adamjth

Thanks chesky and TBagpuss for your advice.

Fireflyaway

Is this working from an emotional point? Its not all about money. Do you speak or just ignore each other? How is your son taking this? I don't think it sounds the best situation and at some point you will have to sell the house or move out. I'd speak to a solicitor and then find a way to split properly. Even if it means renting a room in a shared house for a while. Sorry I know that wasn't exactly your question but living in limbo isn't going to help you move forward.

cashbackproblems

I would start to prepare for divorce hide what assets you can remembering the courts will ask for last 12 months worth of statements so start now as it doesnt sound like you will divorce yet

Gigervamp

It will be difficult to claim benefits, if needed, if you're still living in the same house.

chesky

Gigervamp wrote: »

It will be difficult to claim benefits, if needed, if you're still living in the same house.

No, it can be done, providing you give absolutely clear evidence that you run separate households. And you really do have to stick to the rules.

DarkShadow

If you need some good advice, cancel the divorce arrangements. You are 48, live as a team, not a lone soldier. Problem happens but you learn to resolve them.

Gigervamp

chesky wrote: »

No, it can be done, providing you give absolutely clear evidence that you run separate households. And you really do have to stick to the rules.

I didn't say they couldn't claim benefits. I said it would be difficult.