Nearly 4.6 million cohabitating adults in the UK are at financial risk as the majority lack wills, according to Royal London.
According to a survey by Royal London, the rising trend of cohabitation in the UK has made unmarried couples financially vulnerable because 73 per cent of cohabitees don’t comprehend intestacy laws.
The study also shows that misconceptions concerning automatic inheritance rights are common among cohabiting couples, with 35 per cent assuming they would automatically inherit their partner’s financial assets.
Cohabitees are not afforded the same legal protections as married couples, and without a will, their partners run the risk of losing their house and possessions.
Only 17 per cent of cohabitees knew that if one held all the assets and died without a will, the other would have nothing.
The study urges cohabitating couples to prioritize creating a valid will to ensure their wishes are legally protected, especially in case of serious illness or inheritance of significant assets.
In the UK, just 36 per cent of cohabiting couples have a will in place, compared to 48 per cent of all adult citizens.
It is advised to seek legal and financial guidance to protect funds, assets, property, and investments for intended loved ones. Pensions normally are not included in an individual’s estate and require separate nomination procedures.
Royal London pensions & legal expert Clare Moffat says: “Having a will is really important for lots of different reasons. The fundamental reason for having a will is to make sure that you decide what happens on your death, not what the law stipulates should happen. It’s important not just for your financial arrangements, but also to choose who will look after any children if you die before they reach 18.
“It doesn’t matter how many years you’ve been living with your other half, cohabitees are not protected by the same laws as married couples and dividing the assets of a cohabiting couple can be complex.
“If you’re not married or in a civil partnership, and you die without writing a will, you’re not entitled to a penny unless you jointly own assets. If you have children together, everything goes to them and if you don’t have children, parents or siblings would stand to inherit assets, not the partner.
“Not making a will can create all kinds of complications, especially if you have children, are unmarried or separated. To make sure everything goes to your nearest and dearest, rather than the law dictating how your assets are divided, it’s important to plan. No one likes thinking about death but writing a will can make life much easier for anyone left behind.”