Not married to your partner? Here’s why you could lose out financially

If you’re in a relationship, but you’re not married or in a civil partnership, you’re in a growing section of society.

Official figures from the Office for National Statistics (ONS) reveal that the number of opposite-sex marriages has fallen by 50% since 1972. The ONS say that this decline is likely due to “increasing numbers of men and women delaying marriage, or couples choosing to live together rather than marry”.

While living with your unmarried partner is an increasingly popular option, it can create issues when it comes to your finances.

New research from leading insurer Scottish Widows has revealed that unmarried couples find it difficult to talk about planning for the worst – in many cases proactively avoiding it as they don’t feel it is important.

Read on to find out why it’s important to talk to your partner and to plan for the future, and for some important steps you should take if you’re in a long-term relationship but not married.

Many couples don’t know if their partner has any life insurance

If you’re in a relationship with your partner, you may live together and have some shared financial commitments. 

So, how would you manage if your partner was off work for an extended period due to an accident or ill health? And, what would you do if they were to die prematurely? Could you afford to carry on paying your mortgage or rent, and bills?

Scottish Widows research has uncovered worrying evidence that almost half (43%) of partners have made no plans to ensure their other half receives a payout if they die. The study also revealed that only half (52%) of unmarried adults who are in relationships know whether their partner even has a life insurance policy.

Of the half of unmarried adults who are in relationships that know whether their partner has put life insurance in place, more than 1 in 4 (27%) don’t know how much the policy is worth.

Overall, the study concluded that levels of awareness of financial issues are lower among unmarried couples than those who have tied the knot. For example, fewer unmarried people in a relationship know how much their partner earns, when compared to married couples.

Same sex couples know more about each other’s finances

Interestingly, Scottish Widows found that people in same-sex relationships are more likely to talk to each other about money.

The study found that 3 in 5 (60%) of married same-sex couples know exactly how much their partner earns, compared to 53% of people married to someone of the opposite sex.

This knowledge drops to 47% for same-sex couples who are not married, and to 45% for unmarried opposite-sex couples.

Additionally, nearly a quarter of married same-sex couples (24%) discuss long-term financial issues every month, whereas married opposite-sex couples only do this every two or three months.

Talk to your partner about financial protection

If you don’t have a conversation with your partner about financial protection, you could leave your loved one in a difficult position if the worst were to happen.

For example:

• Statutory Sick Pay in the UK is just £99.35 a week in 2022/23 and only payable for 28 weeks. So, if you have shared financial commitments and your partner has no protection in place, could you pay your bills if their earnings were to reduce to less than £100 a week?
• If your partner was to be diagnosed with a serious illness, could you keep paying your bills?
• Does your partner work for themselves? If so, their income might dry up completely if they can’t work. Additionally, they may have no employer-provided pension or life insurance and so may have significant gaps in their protection.

As Scottish Widows protection director, Rose St Louis, says: “Despite being difficult to discuss, there is an urgent need for transparency to ensure long-term security.”

You may be in even more need of protection if you have children or a mortgage

According to the University of Manchester, in 2021, more babies – 51% – were born to unmarried mothers in England and Wales than to those in a marriage or civil partnership for the first time since records began more than 160 years ago.

With the majority of babies being born to unmarried parents, it’s even more important to talk to your partner to ensure you have financial protection in place.

Having children is a huge responsibility. As well as caring for them, you also take on the financial responsibility that comes with raising a child to adulthood. According to the Child Poverty Action Group (CPAG), the total cost of raising a child to the age of 18 now stands at £160,692 for a couple and £193,801 for a single parent.

So, if you or your partner were to pass away unexpectedly, would the surviving parent be able to meet the costs of raising your child? Would your son or daughter’s prospects be negatively affected if you died?

Despite the need for protection, you have previously read about research published by consumer group Which? that revealed 36% of adults with dependants don't have any form of life insurance in place. This lack of cover could leave millions of families vulnerable if the worst happened. 

Similarly, if you and your unmarried partner have a mortgage, you may struggle to keep up with your repayments on one income. So, it may be vital that you put protection in place to give you the peace of mind that you could continue to live in your home if the worst happened.

As life insurance experts, we can help you to find cost-effective cover. We can scour the prices of life insurance, Critical Illness cover, and income protection from dozens of the UK’s leading insurers to help you get the cover you need at the very best price.

Get a life insurance quote online now and give yourself the reassurance you and your partner need.

The importance of making a will

If you’re not married to your partner, did you know that your assets are unlikely to pass to them when you die?

When someone dies without leaving a will, the intestacy rules decide who inherits the assets from their estate. Assets are normally passed to:

• A spouse or civil partner, then
• Children, then
• Parents, then
• Siblings.

Even if you are living with your partner, and you have been a couple for a long time, they will not inherit your assets when you die unless you have made a will.

Additionally, nothing will pass to any children of your cohabiting partner from a previous relationship, even though they may have been brought up as your own children.

If you want to make sure that your unmarried partner receives your assets when you die – your savings, your share of your jointly-owned home, and so on – you need to write a will.

In your will you can outline who you would like your estate to pass to on your death. As well as significant assets you can also specify who will receive certain items – perhaps those of sentimental value.

It’s the same when it comes to the proceeds from any life insurance policy you put in place. If you don’t place this in trust, the payout will form part of your estate. If you’re unmarried and don’t have a will, this payout may not pass to your partner.

Here are three ways you can make sure your money passes to the person you wish.

Get in touch

If you’d like the peace of mind that you and your partner are protected if the worst should happen, we can help.

Get a life insurance quote now or speak to one of our experts for help.