Couple relaxing in apartment after researching the differences between cohabitation agreement vs Will.

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Cohabitation Agreement vs Will - What Couples Need to Know

What's the difference between a cohabitation agreement and a will? And how does this choice impact your assets? Trust & Will explains.

Patrick Hicks

Patrick Hicks, @PatrickHicks

Head of Legal, Trust & Will

Are you one of many American couples who live together but aren’t married? Marriage and domestic partnerships provide legal oversight over what should happen to your personal and communal property should you get a divorce. However, the rules over what happens should you break up or separate are either gray or non-existent. 

Setting up a cohabitation agreement is a great option to protect yourself, but you’ll want to take it a step further by setting up a Will as well. Trust & Will discusses the differences between a cohabitation agreement vs. Will when it comes to making estate planning decisions for this type of scenario.

What Is a Cohabitation Agreement? 

A cohabitation agreement is a legal contract that is drawn up between an unmarried couple that is living together. It can be drawn up at any time, but is ideally created before moving in together or soon after. The contract can address what should happen if the couple should break up or one of the partners passes away with regards to property, personal assets, debts, and other considerations. Because your lives can become intertwined over the years, the cohabitation agreement can proactively address these issues to help prevent conflict and/or expensive fees should anything happen. Learn more in our guide, Cohabitation Agreement: Living Together but Not Married

What’s included in a cohabitation agreement?

The details of a cohabitation agreement will depend on the couple’s circumstances, such as their levels of wealth and whether or not they have children. In general, these agreements provide provisions of what should happen if the couple should split up, or if one of the partners were to pass away.

The agreement should at minimum address the property that the couple owns now, what they might acquire in the future, and how it should be divided should they break up. Further, it should address what should happen to the property if one of them were to pass away. 

In addition, a cohabitation agreement can address the division of financial assets, such as savings, retirement savings, and expectations of financial support for one another. Last but not least, the agreement can discuss the care of children and children from prior relationships. 

What is a Will?

A Will is a legal document that specifies your wishes regarding what should happen to your property after you pass away. An individual with children can also use their Will to designate an adult who will care for them. A properly-executed Will ensures that the individual’s assets are protected and will pass to their surviving spouse and/or heirs if they pass away. Learn more about how a Will works in estate planning here

What’s included in a Will?

There are several key items and points of information that one can include in a Will. Here are some of the main topics that are addressed:

  • Final Arrangements: Many individuals prefer to specify their wishes regarding their final arrangements, and the Will is the perfect place to do so. If you have preferences regarding your funeral arrangements and your remains, they can be specified here.

  • Property: Real property such as your home or land that you own should be listed, along with your wishes for how it should be divided amongst your heirs.

  • Assets: A Will can also specify your wishes for how your assets and personal property should be divided amongst your heirs.

  • Executor: How can you ensure that the wishes in your Will will be fulfilled? This is done through the act of naming an Executor who is charged with the duty of seeing your wishes through.

  • Guardianship: If you have any dependent children, appoint your guardian who will look after your children should anything happen to you. This peace of mind alone is a great motivator for putting a Will in place. 

Cohabitation agreement vs Will: what’s the difference?

You may have noticed that there are some areas of overlap between a cohabitation agreement vs. Will. However, these are two separate legal documents that serve different purposes. 

A cohabitation agreement primarily addresses how property should be divided between a cohabitating couple should they break up, or if one of the partners passes away. In essence, it helps determine how communal property should be divided between the two individuals. However, this is just one piece of a comprehensive estate plan.

The couple should have Wills in place, in conjunction with the cohabitation agreement, if they would like to leave property to one another, or heirs of their own. Further, the Will addresses several issues that a cohabitation agreement does not, such as Guardianship and final arrangements. 

Should I use a cohabitation agreement or a Will for my estate plan?

A cohabitation agreement and a Will are both great components for a comprehensive estate plan. If you are in an unmarried partnership and are living with your partner, you may want to proactively address how to divide up property and assets you own together should you ever break up. A cohabitation agreement addresses these issues and can be a great way to prevent conflict (or even expensive lawyer fees) should anything happen. 

However the agreement doesn’t address what should happen to the entirety of your personal estate should you pass away or become incapacitated. While the cohabitation agreement may pass some property to your partner, it usually isn’t inclusive of your estate as a whole. Further, it won’t address any personal property that you’d like to pass to your children, especially those from a prior relationship. Last but not least, your Will addresses other important matters not included in the cohabitation agreement, such as Guardianship and your final arrangement wishes.

At the end of the day, you should always have a Will in place, no matter your personal circumstances. If a cohabitation agreement would serve you, then it’s a great tool to add on in conjunction to your Will.

Want help setting up your estate planning documents? At Trust & Will, we’re here to help keep things simple. You can create a fully customizable, state-specific estate plan from the comfort of your own home in just 20 minutes. Take our free quiz to see where you should get started, or compare our different estate planning and settlement  options today!

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