When Clients Cohabitate, It's Time For "The Money Talk"

By Laura McCarron via Iris.xyz

Every advisor has seen it. A client announces the great news: he or she is moving in with a “significant other” and the couple can’t wait to begin a new life together.

And yet, in most cases, while your client has already looked at all the advantages of this next step, the one thing that probably hasn’t happened yet is “the money talk.” Young or old, never married, divorced, or widowed, it’s all too easy for someone planning a live-in partnership to neglect the financial details of what can be a tricky arrangement—both emotionally and financially.

As an advisor, it’s your responsibility to act in your client’s best interest. In this case, that means bringing up the elephant in the room and sitting down to discuss the practical arrangements that should be in place to help protect your client’s assets—no matter how the new living arrangement plays out in the end. It’s wonderful to share your client’s joy and excitement, but then roll up your sleeves and help your client focus on the business side of this new partnership using these guidelines:

Make financial planning a priority.

In traditional marriages, most couples comingle their finances, which simplifies the process of budgeting and bill paying. Unmarried couples are more likely to maintain separate accounts, which makes financial planning particularly critical.

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