Financial implications of not being married

[tearocket]

Can someone please explain to me like I am 7 years old, what the benefits of being married are over just having a will?

Very long term cohabiting relationship, wills in place, joint mortgage owners, both beneficiaries on the others pension.

Do we still need to be married to provide further protection?

Google is your friend

I have googled but can't find a definite answer that I can understand. I have processing difficulties, so would appreciate a kind Mumsnetter helping me out here @Middlechild3

Inheritance tax you get absolutely whacked if you are not married and might need to sell your house to pay it. This is why people have deathbed weddings.. Only applies if your estate above the relevant thresholds. Some pensions only pay out to spouses. Zero protection if you sacrifice earning power for good of the family.

Inheritance tax isn't payable between spouses.

If you separate the less well off can have a claim on the more well off.

Have you also done powers of attorney (financial and health&welfare)?

If married your joint assets get divided if you split. If not married, you just keep whatever you have in your name. Also easy access to the otters money in the event of death, being next of kin, inheritance allowances joint.

if you are both financially independent and neither is giving up something to benefit you both (you go part time to raise the kids) then I think it’s pretty minimal.

you can sort out most of the above either way a legal agreement if you don’t want to get married.

Thank you. Am I right in thinking that if the higher earner dies and we are not married, the next of kin is automatically our child/ren?

Inheritance tax is a big one.

Also will can be lost (or changed). A relative of DH's ended up having to go through the process as if his wife was intestate as the will couldn't be found.

If you don't marry then you should also get LPOA to ensure no hassles with other family members and to make the process as smooth as possible if one ends up in hospital, has care needs or requires decisions to be made about care homes etc.

We do have Powers of attorney yes

Also if you're married you can combine IHT allowance, if applicable, to whoever will inherit after the second of you dies.

Wills can be changed without notifying the beneficiary/ies of the previous will.

Your main issue is wills can be changed. Being married/ civil partnership gives you the legal protection of the legal spouse. You can have joint mortgage but house ownership is not necessarily 50/50 when not married depends on agreement when you signed the deeds. Life insurance normally passes to legal spouses when married but can be problematic paying out if you are not married expression of wishes is not legally binding on the trustees. ISA allowances can be transferred to married spouse on death of spouse non married don’t have same. As mentioned earlier married couples have lots of tax benefits inc IHT allowance.

Thank you everyone. Civil partnership is the way forward I think!

Let's just say you gain more security with a marriage certificate than without one. It isn't worth the risk for a bit of paper. Also, on a possibly trivial note. When my partner of 26 years died and I had to register his death, the registrar marked me down as the "causer of burial" because by law I was basically nothing to him.

I am sorry @ginasevern 😔

Thank you to everyone that helped with my questions, I appreciate it very much. Am now researching civil partnerships which my partner will be very happy about seeing as he proposed 10 years ago 😁Currently thinking just to have our children there and two random witnesses. It might actually end up being romantic rather than a formality 😉

With having children then the inheritance tax benefits (assuming they're still similar) will definitely make it worthwhile having the Civil partnership.

It'll not make any different day-to-day or when life is good, but in bad or sad times it can be a very helpful thing.

It'll not make any different day-to-day or when life is good, but in bad or sad times it can be a very helpful thing.

This is an excellent sentence.

If you have children and one spouse dies there are benefits you can get only if you had been married/civil partners.

If you are fully committed to each other it’s a first family you have built together and you have children together and none from previous relationships it seems perverse to me not to be in a civil partnership. Don’t get why you would not?

@TheaBrandt1 yes, we had always planned to marry and have been engaged for 10 + years (!) but I was reluctant as I am not religious and think that traditional marriage is outdated and old fashioned. I am also autistic and the idea of a ceremony etc in front of others fills me with dread. Then children, houses, careers, got in the way but we always talked about doing it in the future. A low key, no frills, civil partnership is the perfect solution for us.

We got a civil partnership 2 years ago as we got fed up of the extra admin to change things to one another rather than next of kin. We have a child together too and just wanted the extra security.
We went with the Tuesday morning special at our registry office 8 weeks after deciding- the two of us plus two witnesses for £57, £35 each for intention of marriage. I bought a new dress on sale for £30 and we took our witnesses out for lunch as they had travel to be our witnesses. It was perfect! Most people, including my parents, don't know we did it!

I am single. My inheritance tax free band due to my house value is £325k. My house is worth more than that. My children are homeless if I die due to IHT. However 90% of people in the UK do not have enough assets to pay IHT so it is not an issue for a lot of people and plenty rent all their lives and have no savings. I am single.

When you marry your children are legitimised which may not be relevant to you or interesting but is still a legal change. They are deemed to be the children of the father on the marriage (if not born without marriage) unless proved otherwise. I think when you marry or have a civil partnership you have to register the children again. I was puzzling the other day when researching previous owner of my house for historical purposes that his daughter had one child, then got married years later and then registered a second child just after of the same name and I even wondered if the first had died but now all is made clear due to this thread on MN and checking the point - the parents must have re-registered the birth after their later marriage. https://www.legislation.gov.uk/ukpga/1976/31/section/9

So my parents were married, when my mum died she left everything to my dad - mirror wills

then my dad wrote another will leaving everything to his children

so when he died

inheritance tax now is payable on

everything over £325k + £150k for property so £475 total but because he was married and his wife left nothing to his children at the time of her death

inherti tax threshold increases by another £325k

so now we have £800k before 40% tax kicks in

otherwise it would have been 40% on everything above £475

so as an example had he left £675k and been divorced or unmarried, then £200k would have been applicable for inheritance tax = £80,000 for the tax man

but because he was a widower, and not remarried - there was nothing to pay in inheritance tax by his off spring

Xenia

you get £325 + £150 for property left to children

It also makes a difference if you are tenants in common or joint tenant's