Financial Planning: Children with unmarried parents
By 2016, assuming current trends continue, more children will be born to unmarried parents than married parents.
The Office for National Statistics has released statistics showing that the number of children born out of wedlock has increased from 11% in 1979 to 25% in 1988 and a record 47.5% last year.
This means that 346,595 babies were born outside of marriage or Civil Partnership in England and Wales last year.
The reason behind these figures is that marriage is now a minority choice.
According to the 2011 Census, only 45% of British households contain married couples. This is the first time married households have been in the minority since the Census started in 1801.
More children born out of wedlock prompts some important Financial Planning considerations.
Planning for what will happen in the event that one or both parents were to die is essential. This means creating a valid will and appointing guardians.
If you die intestate (without a will) as an unmarried parent, then the law decides who inherits your money and property. It will go to your children and not to your partner, who is likely to need the financial support.
If an unmarried mother dies and the father does not have parental responsibility, he would have to go through the stress and expense of applying for this through the courts.
You definitely need to consider your life assurance requirements, putting in place a suitable trust where needed.
The married couples tax break, which is expected to be introduced in the Autumn statement, is unlikely to encourage unmarried parents to get married.
What unmarried parents should be doing, as a matter of some urgency, is sitting down with a Financial Planner and constructing a comprehensive Financial Plan to address those issues most important for their family.
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