You’re in a new stage of life now. You’ve built up your assets for yourself and your children, and you’re about to embark on a new adventure with a new partner. How do you ensure that in the unexpected event that you and your new partner split, that all your hard work stays within your family? While estate planning with an estate lawyer is a huge part of protecting your assets and ensuring everything goes to who you want it to at the time of death, it’s equally important to have a family agreement prepared by a family lawyer to be sure everything stays with you now. Consider a cohabitation or prenuptial agreement as financial planning for your newly blended families.
For some couples, you may choose not to get remarried, and want to spend your golden years cohabitating in a marriage-like relationship instead. However, you may not have realized the common law rules within British Columbia. If you’ve lived together for 2 years or longer, you are considered spouses as per the Family Law Act.
With real estate prices reaching record highs in British Columbia, owning your own home, or second property, outright, or with a large amount of equity in it, is a huge advantage. Now, while anything that you have while entering into the relationship is considered excluded property, the increase in value afterwards is up for division. Depending on your income level it may be difficult to buy out your partner’s half of the property, should the relationship come to an end. This could mean you end up with either a hefty loan payment, or force you to sell your home. This leaves you in a lesser state, as well means you may no longer have this asset to hand down to your children.
Pensions, CPP, RRSPs, and RRIFs are also all considered family property. These can be complicated, so it’s always best to get legal help to sort it out. Generally, you and your partner are entitled to a share of the benefits that either of you accrued while living together. Legal Aid B.C. has more details on these dividable, as well as non-dividable benefits here.
There are a lot of complexities when it comes to spousal support and retirement. Being retired is no guarantee that there will not be spousal support expectations post separation. In British Columbia, courts consider various factors when determining spousal support for retirees, including the length of the relationship, the financial means and needs of both parties, and any economic advantages or disadvantages arising from the marriage or its breakdown. Even if one spouse has retired, they may still be required to pay support from their pension income or other retirement assets. The court will assess whether the retirement was reasonable and if it has unfairly impacted the other spouse’s financial situation. It’s crucial for separating couples approaching or in retirement to seek legal advice to understand their rights and obligations regarding spousal support in this unique stage of life.
If any these topics bring up concerns, consider booking a free initial call with one of our team members. Our legal team is experienced in all of the intricacies that may come up in cohabitation, prenuptial and separation agreements.*
*Blog posts are not legal advice. Please contact a member of our team to get personalized legal advice.