As more South Africans choose to live together without getting married, financial experts warn that many couples may unknowingly expose themselves to significant financial and legal risks.
Although cohabitation has become increasingly common, many people mistakenly believe that living together for several years automatically grants them the same legal rights as married couples. However, South African law does not recognise a “common-law marriage”. Consequently, cohabiting partners may lack important legal protections if their relationship ends through separation, illness, incapacity or death.
Understanding these risks and planning accordingly can help couples avoid financial hardship. It can also ensure that both partners receive appropriate protection. Therefore, cohabitation and financial protection should form part of every couple’s financial planning before they move in together.
The myth of common-law marriage
One of the biggest misconceptions among South Africans is that living together for a certain number of years automatically creates a legal marriage. This is not the case.
Unlike married couples, cohabiting partners do not automatically acquire rights to each other’s assets, estates, pension benefits or inheritances. If disputes arise, individuals may need to rely on complex legal principles. These include contract law, unjust enrichment, or universal partnership claims, which can be difficult and costly to prove.
A relationship may be built on trust and commitment, but assumptions can prove costly when it comes to finances and legal protection. Couples should understand their rights and responsibilities before moving in together. They should not wait until a crisis occurs to discover the implications.
The hidden financial risks
One of the greatest areas of vulnerability relates to asset ownership. For example, one partner may pay the home loan while the other covers groceries, utilities, children’s expenses, school fees and other household costs. Although both individuals may contribute significantly to the household, only one partner may build legal ownership of a valuable asset.
Similarly, many cohabiting partners incorrectly assume they will inherit from their partner when that person dies. However, an unmarried partner has no automatic right to inherit under South African intestate succession law. A valid will or other specific legal arrangements may help protect the surviving partner.
Consequently, surviving partners may face financial hardship despite having shared a home and life with their deceased partners for many years. This highlights why cohabitation and financial protection require careful planning, particularly when couples share property and other financial responsibilities.
One of the most common misconceptions we encounter is the belief that a long-term cohabiting partner will automatically inherit from a deceased partner’s estate. In reality, where there is no valid will in place, a surviving cohabiting partner generally has no automatic right to inherit. This can create significant financial hardship at an already difficult time. Having a valid will and regularly reviewing beneficiary nominations are among the most important steps cohabiting couples can take to protect each other and ensure their wishes are carried out.
Why women may face greater financial vulnerability
Although both partners can experience the legal limitations of cohabitation, women often face disproportionate financial consequences when relationships end.
Many women continue to shoulder a greater share of caregiving responsibilities. These include raising children, caring for elderly family members, and managing household responsibilities. Consequently, these commitments can interrupt careers, slow salary growth, reduce retirement savings, and limit long-term wealth accumulation.
In some relationships, women also contribute significantly to household expenses and family wellbeing without acquiring legal ownership of major assets. As a result, they may face financial uncertainty if the relationship ends unexpectedly.
Many women make significant contributions to a household, whether through childcare, caregiving, managing household responsibilities, or contributing to monthly expenses. However, these contributions do not automatically translate into legal ownership of assets or financial protection if the relationship ends.
Protecting yourself before moving in together
Experts encourage couples to have open and transparent financial discussions before deciding to live together.
Important topics include household expenses, asset ownership, debt obligations, savings goals, retirement planning and insurance cover. Couples should also discuss how they would manage their finances if the relationship ended.
Women should also consider the following steps:
- Entering into a formal cohabitation agreement.
- Maintaining independent savings and retirement plans.
- Keeping records of significant financial contributions.
- Ensuring that ownership arrangements are clearly documented.
- Updating wills and beneficiary nominations regularly.
- Obtaining independent legal and financial advice.
Having these conversations may feel uncomfortable, but they are essential. A cohabitation agreement is not about anticipating failure; it is about ensuring fairness, clarity, and financial security for both partners.
By taking these steps, couples can establish clearer expectations and reduce uncertainty about their financial responsibilities. A well-drafted agreement can also help clarify how they will divide assets and manage shared obligations if their relationship ends. Therefore, cohabitation and financial protection should remain central considerations when couples make long-term financial decisions.
Greater awareness needed
Although many legal and financial experts argue that South Africa should consider stronger protections for long-term cohabiting partners, current legislation provides far fewer automatic rights than marriage.
Until lawmakers introduce further reforms, individuals need to take proactive steps to safeguard their financial futures.
Love and commitment should remain the foundation of any successful relationship. However, couples must support those values with proper legal and financial planning. Understanding the implications of cohabitation and taking steps to protect themselves from the outset can help them avoid significant financial hardship later.
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| Ilse Smuts | Head | Business Development | Cash Investments | mail me | | Heather Muller | Head | Estate Product | Fiduciary | mail me | |
| | FNB | | |
