You are Cohabiting

Every couple has their own reason of cohabiting. Your partner could be a married person still going through his/her divorce; you are both of the same gender; or both of you are in love but do not want the legal commitment of a marriage. Whatever the reason for your cohabitation, estate planning is very important if both of you really care for each other.

Estate Planning Implications and Potential Problems

1. You or your partner will not have any legal position in the Intestate Succession Act. If you die without a will, your partner will be completely excluded from your estate and vice versa.
2. Your partner will not have any legal position in Section 61 of the Insurance Act. If you die without making any nomination of a beneficiary in your life policy to your partner, he/she will not qualify to be the proper claimant to claim the policy proceeds.
3. If you have a child with your partner, the child will be considered illegitimate, and the child’s legal position in your estate is restrictive. For example, the Intestate Succession Act does not recognise an illegitimate child. The Insurance Act does recognise an illegitimate child as a proper claimant, but if your child is a juvenile, it is difficult for your child to be the proper claimant of your life policy.
4. You do not qualify to be an irrevocable beneficiary (S49L) of your partner’s life policy.
5. If you co-sign a loan or mortgage with your partner, you are still liable for the outstanding amount when your partner dies.
6. If your partner dies without a will, it is inconvenient for you to seek consent from his/her family to be the administrator of your partner’s estate.
7. If your partner excludes you totally from his will, you cannot use Section 3 of the Inheritance (Family Provision) Act* to secure your financial needs when your partner dies. (*Section 3 of Inheritance Act empower the court to order payment out of net estate of deceased for surviving spouse or child)

Estate Planning Solutions

1. Your (or your partner) should arrange a S49M life policy, and nominate your partner (or you) as the beneficiary.
2. You should have a will written.
3. You should have your CPF nomination updated if you want to allocate some CPF to your partner.
4. If it is inconvenient to distribute your assets through a will when you die, you may want to consider using the assignment of your life policy or a trust to execute the asset transfer to your partner in a low profile way.
5. Give serious thought to how you want to own your property, whether through joint tenancy or tenancy in common. Both ownership structures have their pros and cons.
6. Give serious thought to the ownership (joint account or single account) of your main bank account deposits.
7. Think about what the financial needs of your partner will be like if you were to die, and allocate assets to provide for or subsidise your partner’s financial base, especially if there are children involved.
8. If convenient, have your partner adopt the child to give the child legal status to your partner’s estate.