Josephine*, who recently turned 70, has two adult children and has been divorced for over two decades. She owns the home she shares with her long-term partner, Tim, who is 85, never married or had children. Josephine still works, mostly to stay busy, and her income is enough to cover their day-to-day living expenses.
She also has longevity – her 94-year-old dad is still doing well, so she knows she is not ready to fully retire at least until she has a better sense of the inheritance she will use to fund most of her retirement.
Tim, on the other hand, is quickly losing the ability to climb the three flights of stairs to enter their 2-bedroom condo and his only income is Social Security. Tim and Josie know that the best way to secure long-term care for Tim would be for him to qualify for public assistance. For this reason, they will never marry.
According to a recent New York Times article, Josie and Tim are part of a growing trend of seniors who are partnered and co-habitating but not married. According to 2023 Census data, almost 1.1 million people ages 65 to 74 are living with a partner, not a spouse. This can make for uncertainty when it comes to caregiving in those latter years, as Josie is beginning to grapple with now.
Should they move to an assisted living facility where Tim can access the care he needs? Or should they remain living independently, considering that Josie has the physical and mental capacity of someone 10 or more years her junior? Is she ready and willing to become more of a caregiver to Tim, her non-spouse, or should she take steps to help him qualify for outside help? What is her obligation?
There are myriad scenarios for this couple to consider, but chief among them is estate planning. If Josie pre-deceases Tim, where will he live? Without legal documents saying otherwise, Tim would be at the mercy of Josie’s children, who are set to inherit her entire estate according to her outdated will from the 1970’s.
Estate planning steps when living with a partner and not a spouse
There’s a joke in the estate planning world that marriage is the cheapest estate plan, which in many cases, can be true. However, with the disappearing stigma of living together outside of marriage, the reasons to remain unmarried often outnumber the reasons to make it legal, especially in cases like Josephine and Tim where there are children from a prior marriage, a disparity in assets and a significant age difference.
In that case, here are the essential elements of estate planning to tie up if you want to make sure your non-spouse partner is involved in any medical or financial decisions for you, should you need help.
Power of attorney: While there are pros and cons to giving your non-spouse partner general power of attorney to handle your financial affairs, imagine if something happened to you and they were unable to pay the electric bill in your name, instead having to wait for a court to intervene or for an outside person to step in and help. An estate planning attorney can help you decide whether a general or springing power of attorney makes the most sense, but offering your partner the ability to at least take care of day-to-day financial issues should you need help could be the practical solution.
Advance health care directive: A living will states your desire for life-sustaining care should you be unable to communicate your wishes, but a health care directive can also give someone medical power of attorney, enabling them to be involved in decisions regarding your medical care that typically defer to children or other blood relatives when a person does not have a legal spouse. While medical providers will often allow a patient to include a non-spouse partner to be privy to confidential details, HIPAA laws can interfere, leaving providers unable to share personal health information without written permission.
Asset titling: How you own property will determine who has control over it should the other of you pass away or become incapacitated. In Josephine’s case, she owns her condo outright, so Tim has no claim on that property should something happen to her, even though he’s lived there for over a decade. She could consider joint ownership if she wished for Tim to remain in the home after her death, or she can include a clause in her Will allowing Tim to continue living there as long as he wishes, but the property ownership could shift to a trust or the ownership of her adult children.
Wills, trusts and beneficiary designations: Many clients choose to add a trusted family member or friend as a joint owner on bank accounts to allow for ease of administration of checking accounts and other ongoing bill-paying, but it’s important to understand that doing this constitutes a gift in the eyes of the IRS and you’ve effectively given the joint account owner complete control over your money. Alternatively, most banks these days will let you name a beneficiary or TOD (transfer on death), which has the same effect of giving the person immediate access to your account upon your death without having to go to court, but without the risk that possession of those assets prior to your death being compromised.
In the case above, with Josephine and Tim, Josie would absolutely want Tim to be able to access her checking and savings account upon her death, but if she were to name him a joint owner now, that could disqualify him from the public assistance they are planning to apply for when Tim needs residential care beyond what Josie is able and willing to provide. Using a TOD or beneficiary designation will allow Tim to receive those assets in the case that she unexpectedly dies first, but also allows Josie to remove that if and when Tim does go onto public assistance and instead include him as a beneficiary of a future trust that wouldn’t compromise his qualification for public assistance.
Work with an estate planning attorney to make sure you’re not missing anything
Of course, this information is not intended to serve as legal advice, it’s just a way for us to remind our valued clients and friends that there are ways to implement some of the legal benefits of marriage with your trusted partner without having to actually tie the knot. We strongly encourage you to enlist the help of an estate planning attorney to craft your personalized plan so that you can be sure that your partner and your family are taken care of in the way that you would wish should you be unable to communicate those desires.
We are happy to recommend trusted attorneys in our network if you need a referral. Otherwise, you may also check your local estate planning council or reach out to your community’s bar organization to find a lawyer who specializes in estate planning for unmarried couples.
*details have been modified to maintain confidentiality