Why contingency planning matters for unmarried couples

Unmarried partners—whether cohabiting for years, in domestic partnerships, or in committed long-term relationships—do not automatically receive the legal protections marriage provides. That gap affects inheritance, hospital access, decision-making during incapacity, and the right to keep a shared home. In my 15 years advising clients, I’ve repeatedly seen how a few targeted documents can prevent long, expensive disputes and preserve the surviving partner’s security.

Federal and state law both matter. Federal guidance covers tax and benefit issues (see the IRS for estate and gift tax rules), while state law controls probate, guardianship, and most powers of attorney. Because state rules vary, read relevant state statutes and consult a local attorney—see Consumer Financial Protection Bureau guidance on planning for unmarried couples for practical checkpoints (ConsumerFinance.gov).

Core estate options and how each protects an unmarried partner

  • Wills

  • What it does: Names beneficiaries and directs how probate assets are distributed. It can name your unmarried partner as beneficiary and appoint them as executor.

  • Why unmarried couples need it: Without a will, state intestacy laws typically prioritize blood relatives and may exclude a partner entirely.

  • Limitations: A will does not control assets with beneficiary designations (retirement accounts, many life insurance policies) or jointly owned property that passes by right of survivorship.

  • Trusts

  • What it does: Holds assets for the benefit of named beneficiaries and can spell out timing, use, and protections (e.g., for children or to shield from creditors).

  • Why they help: Trusts can avoid probate, allow private handling of sensitive distributions, and create phased distributions or spending rules tailored to the couple’s goals.

  • When to consider: If you own real estate in multiple states, want to avoid probate, or need protection for a partner or children from prior relationships. For a primer on choosing between wills and trusts, see our guide: Wills vs. Trusts: Which Do You Need?.

  • Beneficiary designations, payable-on-death (POD), and transfer-on-death (TOD)

  • What they do: Let assets (bank accounts, securities, retirement plans) pass directly to named beneficiaries outside probate.

  • Why they matter: These designations override wills for the assets they cover. Make sure your partner is named where you intend them to benefit.

  • Best practice: Coordinate beneficiary forms with your will/trust to avoid conflicts. Our explainer on beneficiary interactions is helpful: How Beneficiary Designations Interact with Your Will.

  • Joint ownership and tenancy options

  • What it does: Property owned as joint tenants with right of survivorship typically passes directly to the surviving owner.

  • Warning: Joint ownership can create gift-tax, creditor exposure, or unintended inheritance consequences. Discuss ownership structure with an attorney and consider complementary documents.

  • Powers of attorney (financial) and health care directives

  • Financial Durable Power of Attorney (POA): Lets a named agent manage banking, bills, and property if you become incapacitated.

  • Healthcare Power of Attorney & Advance Directives: Appoint a partner to make medical decisions and specify end-of-life wishes. These documents give immediate authority in hospitals and with providers.

  • Tip: Execute both durable and medical POAs so your partner can act without court intervention. For drafting tips and timing, see our resource: Healthcare and Financial Power of Attorney: When to Start and How to Choose.

Special concerns for unmarried couples

  • Children and guardianship
    If you share children or one partner has children from another relationship, name legal guardians in your will. Guardianship disputes can be lengthy and emotionally painful; a clearly drafted will reduces uncertainty.

  • Taxes and large estates
    Married couples usually benefit from portability of federal estate-tax exemptions and unlimited marital deductions. Unmarried partners do not. If your combined wealth is substantial, work with a tax advisor to model potential estate tax exposure and consider trusts or other techniques. Check current IRS guidance for estate and gift tax thresholds (irs.gov).

  • Retirement plans and Social Security
    Many retirement plan rules restrict who can be named beneficiary. An unmarried partner may not have the same survivor benefits a spouse receives under some employer plans or Social Security rules. Review plan documents and update beneficiary forms.

  • Healthcare access and hospital visitation
    Hospitals in many states will honor a partner’s role if you have clear advance directives; without them, a partner may be blocked from decisions or even visitation during critical hours.

Practical, step-by-step contingency plan checklist

  1. Inventory assets and account ownership (list titles, beneficiary designations, and co-owners).
  2. Decide immediate goals: joint home, income support, guardianship for children, legacy gifts.
  3. Create or update a will naming your partner where intended and appoint an executor.
  4. Fund or create a trust if you need probate avoidance, privacy, or staged distributions.
  5. Update beneficiary forms on retirement accounts and life insurance to name your partner where appropriate.
  6. Execute a durable financial power of attorney and a healthcare power of attorney (advance directive/living will).
  7. Consider joint ownership for specific assets, but weigh tax and creditor effects with an advisor.
  8. Store originals in a safe, accessible place and give trusted copies to your agent(s) and attorney.
  9. Review annually and after major life events—buying a house, new child, change in health, or move to a new state.

Common mistakes I see (and how to avoid them)

  • Relying on informal promises: Handwritten notes or “we have an agreement” are usually not legally binding. Use formal, witnessed documents.
  • Forgetting beneficiary forms: Retirement plans and life insurance pass by beneficiary form, not by will. Coordinate all documents.
  • Using joint title as a catch-all fix: It can transfer unintended ownership and create tax or creditor exposure.
  • Not updating documents after life changes: A new child, a death in the family, or an interstate move often requires document updates.

Drafting tips and team you’ll need

  • Work with an estate attorney licensed in your state for wills, trusts, and guardianship provisions. State law governs intestacy, probate rules, and powers of attorney.
  • Use a tax advisor for estate-tax modeling if your net worth is high. The IRS provides official estate and gift tax resources at irs.gov.
  • Meet with a financial planner or fiduciary advisor to align beneficiary designations and investment accounts with your estate goals.

Sample clause language (illustrative only)

  • Naming a partner as beneficiary: “I give and bequeath to [Partner’s Full Name], my partner, the sum of $X and all my interest in [describe asset], to be theirs absolutely.”
  • Power of attorney agent appointment: “I appoint [Partner Name] as my attorney-in-fact to act on my behalf regarding financial matters during my incapacity.”

(These samples are for illustration. Use counsel to draft legally effective wording in your state.)

Updating and maintaining your plan

Review documents at least every 2–3 years or after major events. Keep digital and physical copies. Confirm that institutions (banks, plan administrators) have up-to-date forms and accept your documents—some employers or states may require specific forms.

Resources and further reading

Final professional takeaway

Contingency planning for unmarried couples is not optional—it’s essential. The right mix of wills, trusts, beneficiary designations, and powers of attorney creates legal certainty and preserves your partner’s and children’s financial security. In my practice, clients who document intentions clearly avoid costly probate fights and gain peace of mind. Start with an inventory, pick the documents that meet your goals, and get state-specific counsel to implement them.

Disclaimer: This article is educational only and does not constitute legal or tax advice. For tailored guidance, consult a licensed attorney and a qualified tax professional.