Sage Advice from Yours Truly

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My partner and I are planning to get married this spring. As same-sex marriage is not recognized in Texas, we are not sure what to do next. We know how to maintain our relationship, but how do we protect it?
Cindy, Austin

Until Texas lifts the ban on same-sex marriage, gays and lesbians will have to take some extra steps to protect their relationships. Before you even think of booking a venue or caterer, visit an estate-planning attorney. Romantic, I know, but there is nothing sexier than a big ole legal document that protects your interests. When I was a financial advisor, I always told my clients that I could predict with 100 percent accuracy that their relationship would end in one of two ways. It was a bet I never lost. You and your partner will either break up or one of you will pass away. Depressing? Perhaps. Accurate? Absolutely.

The challenge for us is that marriage comes in a tidy little package bestowing contracts and privileges to those who have access to marriage. For example, married couples can pass unlimited amounts of money back and forth. However, if I were to give money to my partner, Alisa, I would be subject to paying gift taxes (up to 45 percent). You may have a great relationship with your family, but death makes people do some crazy things.

I recommend scheduling some time with an attorney to prepare a Medical Power of Attorney. This will ensure that you and your partner will be empowered to make medical decisions on behalf of one another. Durable Power of Attorney is basically the same as the above, but this one lets you make financial decisions on your partner’s behalf. Lastly, think about a cohabitation agreement, which is essentially like a gay prenuptial agreement. Here you can agree on what you think a happy relationship is and what should happen when it’s not so happy.

Everyone, regardless of relationship status, needs a will to direct the distribution of your assets and burial instructions so your loved ones don’t have to guess and argue over what to do with you after you’re gone. Without these two very important documents, your house could go to your UT-bound nephew and you can kiss your beautiful herb garden goodbye.

In trying to stay within my budget, I am cutting all unnecessary spending. One thing I put on the chopping block was renter’s insurance, but my girlfriend balked. Why is it important to have renter’s insurance if I don’t own the condo we live in?
Helen, Houston

Helen, you are a lucky lady to have such a smart girlfriend. Hang on to that one! She is correct: Renter’s insurance is important even if you don’t own the property. Damage to the physical structure of your condo is covered by property insurance, which is typically carried by the owner of the unit. It protects against events, usually called “perils,” that can damage your condo. Perils are fire, lightning, windstorm, hail and even volcanic eruption! This coverage does not extend to the contents, however. So if a tree falls through the roof in one of those nasty unexpected Texas storms, the property owner is responsible for repairing the damage to the condo. But, if the tree causes damage to your belongings, such as your computer, furniture, clothing, etc., then you are out of luck and out-of-pocket for the replacement. Add up the value of your possessions and how much you would have to spend to replace it all if it were stolen, damaged, etc. Then get a quote for renter’s insurance. A quick trip to Nationwide.com (National Corporate Partner of the Human Rights Campaign who also received a perfect 100 on the Corporate Equality Index) shows that the average cost of renters insurance is $12 per month for $30,000 of property coverage and $100,000 of liability coverage. Yep. Liability coverage. So you are covered not only for damage to your property, but also for personal injury or property damage inflicted on others. The last thing you want draining your house fund is a nasty lawsuit from your partner’s ex feigning a slip-and-fall!

 


Advice by Lynn Yeldell
L Style G Style – Storyteller of the Austin LBGT Community.
#GetToKnowUs

 

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