Many married couples enter prenuptial or postnuptial agreements to clarify and address financial matters. Unmarried couples in California cannot enter marital agreements, but they have another option.
A cohabitation agreement can offer many of the same benefits marital contracts extend. When drafted thoughtfully, it can be a powerful tool to navigate potential hurdles and protect your future. Like a prenup or postnup, it is a written agreement outlining each party’s expectations and responsibilities if they part ways.
What are some benefits?
For one, it can give you both financial clarity throughout your relationship, which may prevent conflict and disagreements. If a breakup does happen, your cohabitation agreement can provide these additional benefits.
Property division guidance: It empowers you to divide income, expenses and shared debts equitably, minimizing disputes about contributions and ownership. You may also specify how to handle joint accounts and property (like a house) upon a separation.
Peace of mind: A clear breakup roadmap may reduce your anxiety about possible future financial implications. An agreement outlining your rights and responsibilities can offer stability and security when ending a relationship.
Protection of separate assets: With a cohabitation agreement, you can safeguard pre-existing assets like inheritances or personal investments. It may ensure these assets remain separate even if their value increases during the cohabitation.
Certainly a cohabitation agreement cannot guarantee smooth sailing in your relationship and not even in a potential break-up. However, a sound agreement can encourage a peaceful and fair resolution. With experienced legal guidance, you protect your rights and help ensure that the agreement meets your needs.
