Don't let romance blind you to the financial downside of living together. Unmarried couples need as much, if not more, financial and estate planning than those who are married. Without it, one or both partners may lose everything they have committed to the relationship. Here is a primer on what steps you should take.

 

Over 6.7 million unmarried couples are co-habitating in America at last count. Over 90 percent of them are heterosexual, in case you're wondering. As such, these couples, regardless of sexual orientation or length of the relationship, are considered and classified as unrelated individuals in the eyes of the law.

 

And the rights of unmarried couples are different depending on your state. Not all states, for example, recognize common-law marriages. As a result, without legal safeguards, the children you are raising, the assets you have mutually accumulated, and the house that you share can easily be taken from the surviving partner. The law will assume that any property and the care of surviving children should pass to your next of kin. Even your stated wishes of what you would want to happen in the event of your death or disability may not be followed.

 

OK, now that I have your attention, the first rule is to protect your estate. Your estate is everything and anything you own, or have contributed to before your death. Next, there needs to be documents established for situations that may be short of death but that still safeguard your rights. This would include what happens to you and/or your partner in the event of disability or illness, which might require someone else to make medical and financial decisions for you.

 

Such an agreement is commonly known as a domestic partnership agreement. Think of it as similar to a pre-nuptial agreement.

 

"Where is the romance in that?" might be your first reaction. "I will sound like a money-grubbing, so-and-so if I broach this with my partner."

 

Granted, it isn't a discussion normally accompanied by candlelight and soft music, but every relationship needs to be anchored in reality. The facts are that every unmarried couple should, at a minimum, discuss and implement a domestic partnership document as well as develop an understanding on expense sharing and individual insurance for household effects.

 

Next in line would be homeowner's insurance, unless the unmarried couple jointly own their home. That's because homeowner's insurance doesn't automatically cover both of you. If one person owns the residence, the other should at least purchase rental insurance to protect his or her belongings.

 

Finally, if both partners believe they are in a long-term, committed relationship, estate planning is a must. A married couple has at least an implied estate plan. The IRS and the courts have already established and safeguarded the rights of a married surviving spouse in the event of death. No such regulations exist for an unmarried couple. As such, everything needs to be documented in legal form.

 

At a minimum, there are at least 10 documents and/or provisions that an unmarried couple should at least consider: a domestic partnership agreement, a health care proxy, a will and/or living trust, durable power of attorney, beneficiaries (especially designations on retirement accounts), properly titled property, life insurance, funeral wishes, welfare and custody of any children.

 

All of the above may sound complicated and/or not worth the effort. You would be right, as long as you never break-up with your partner, or if you never die, but if you feel that either one could happen to you sometime in the future then heed my advice.

 

Bill Schmick is registered as an investment adviser representative and portfolio manager with Berkshire Money Management (BMM), managing over $200 million for investors in the Berkshires.  Bill's forecasts and opinions are purely his own. None of the information presented here should be construed as an endorsement of BMM or a solicitation to become a client of BMM. Direct inquiries to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com.

As traders and institutions put to bed the first quarter, several concerns loom large in the weeks ahead. How things play out over that time period will have important implications for the averages, given that they are not far from their all-time, historical highs.

 

What will the Fed do in May? Will Washington pursue tax cuts and if so, will there be opposition?  What will first quarter earnings look like and how will markets react to all of the above? Let's look in my crystal ball, shall we?

 

Wall Street analysts expect corporate earnings to be higher by as much as 10-11 percent. That would be a big change from the recent past, where dismal guidance and feeble results have been the name of the game. If the numbers match or beat expectations, that could be good for stocks.

 

Next up, the central bank, what are its intentions between now and June? The betting is that there is little chance that the Fed will raise rates again between now and then. If so, chalk up another positive for the markets.

 

Then there is the Washington wild card where all sorts of things could go right or wrong, depending on a fractured Republican party and a mercurial administration. Last week's debacle, centered on the belly flop that was the House's attempt to "repeal and replace" Obamacare has set people thinking and worrying about the future.

 

I'm thinking that we may still need a few more days/weeks of consolidation before markets begin to climb. We have already brushed my first downside target for the S&P 500 Index at 2,323. Many times markets will re-test the lows before traders are satisfied that "the bottom is in," so don't be surprised if that occurs. As I have written before, this congestion is a good thing.

 

It's about time some sanity returned to the markets. Investors were way too optimistic about the extent and timing of Donald Trump's campaign promises. By the price action, one would have expected that all the things Trump promised would be delivered in his first 100 days. No never mind that he never said that, or event hinted that would occur.

 

Remember, however, that the short-term swings in the stock market are no longer controlled by human "thinkers and doers." While the "thinkers" appear gone forever, the "doers" are still around — in the form of superfast computers and algorithmic software programs. These robots account for over seventy percent of the daily volume spewing out thousands of buy and sell orders at the simple mention of a word or topic.

 

"Trump tweets health-care reform" or "House fails to pass" is all that is necessary to tack on (or off) a percentage or more of value in any stock, index or market, anywhere in the world. In the last quarter, an avalanche of such comments kept the robots spewing out orders, the majority of which were buys. No never mind that little in substance was accomplished during that period.

 

Part of the problem lies with the president's method of communicating with the public. Neither Wall Street nor Main Street is familiar with this sort of governance. In the past, when the leader of the largest most powerful nation on earth, said something publically, it was taken as gospel. The assumption was that mountains of research, discussions and thought crafted every word and punctuation mark of a President's words.

 

As such, we could all rely on those words as sacrosanct. It was the way policy could be telegraphed not only to American citizens but to the world at large. In the case of investors, it sometimes signaled a change in direction that could be acted upon with the surety that, good or bad, that whatever the change, it was here to stay.

 

That is not how things are done under this president. Yet, few seem to recognize this. In my opinion, President Trump's tweets should be taken for what they are: simple "High Fives," messages meant to keep us in the loop, more hopes and dreams, than signed and sealed policy statements. It will also take time for our newbie president and a Congress that hasn't been in the majority since 2007, to figure that out as well. At some point, but not necessarily at the same time, traders and investors will hopefully stop reacting to tweets and wait instead for more substantive actions before pulling the trigger. Time and patience are the key words here.