When two be­comes wan

Daily Express - - Your Money - By Har­vey Jones

LOVE and money can make a tricky com­bi­na­tion and cou­ples of­ten choose to keep the two things sep­a­rate as a re­sult.

Many con­tinue to prize their fi­nan­cial in­de­pen­dence, even af­ter get­ting married or com­mit­ting to a long-term re­la­tion­ship.

Just one in 10 married cou­ples over 50 share all their money with their part­ner in a joint cur­rent ac­count.

Two in three op­er­ate a joint ac­count but put less than half of their money in there, while one in five do not have one at all, ac­cord­ing to new re­search from Saga Per­sonal Fi­nance.

Man­ag­ing di­rec­tor Jeff Bro­mage said that set­ting up a joint ac­count is a sig­nif­i­cant mo­ment in a re­la­tion­ship: “It is im­por­tant to talk openly about who is man­ag­ing that money.”

Joint sav­ings ac­counts make it eas­ier to man­age re­spon­si­bil­i­ties such as ser­vic­ing a mort­gage and pay­ing house­hold bills, but they must be han­dled care­fully.

If the ac­count goes over­drawn, each ac­count holder is re­spon­si­ble for the money ow­ing. If a part­ner with­draws cash with­out the other’s per­mis­sion, they have few ways of get­ting it back.

Ac­count hold­ers will be co-scored by credit agen­cies so be wary if your part­ner has a poor credit record.Ask Ex­pe­rian or Equifax to re­move their name from your re­port if you break up.

IN SICK­NESS

In­surer AIG Life chief fi­nan­cial of­fi­cer Don­ald MacLean said even the most in­de­pen­dent cou­ples can quickly be­come fi­nan­cially re­liant if one part­ner falls ill or loses their job.

Ev­ery year, one mil­lion peo­ple are un­able to work due to pro­longed sick­ness or in­jury, ac­cord­ing to the As­so­ci­a­tion of Bri­tish In­sur­ers. “Sud­den loss or drop of in­come can cre­ate an enor­mous bur­den on part­ners and it is im­por­tant to have a fi­nan­cial safety net,” MacLean said.

An in­sur­ance pol­icy called in­come pro­tec­tion will pay a re­place­ment in­come if one of you can­not work for long pe­ri­ods: “It can pay a monthly ben­e­fit if a spouse or part­ner has to give up work to care for the other.”

Poli­cies are is­sued by in­sur­ers such as Ae­gon, AIG, Aviva, Le­gal & Gen­eral, LV= and Vi­tal­ity, and mostly sold through in­ter­me­di­aries.

PEN­SION PROB­LEM

An­other dan­ger is that one part­ner be­comes over-re­liant on their spouse’s pen­sion be­cause they have not built up suf­fi­cient re­tire­ment sav­ings.

Just over a quar­ter of over-50s will be de­pen­dent on a part­ner’s pen­sion, ac­cord­ing to SunLife, and that fig­ure rises to 30 per cent for women.

In­surer Ae­gon’s head of pen­sions Kate Smith said women should save more: “Those with ac­cess to a work­place pen­sion must not opt out, and in­stead aim to max­imise their em­ployer con­tri­bu­tions.”

The self-em­ployed need to set up a per­sonal pen­sion and women who have taken maternity leave or time out as a carer should try to make up the pen­sion short­fall, Smith added.

Part­ners can help a non-work­ing spouse or part­ner by in­vest­ing £3,600 a year in a per­sonal pen­sion on their be­half.They can claim 20 per cent tax re­lief on con­tri­bu­tions, re­duc­ing the cost to £2,880.

Pic­ture: GETTY

FI­NANCES: Keep con­trol

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