Written Agreements

When you are dealing with monies, even if you are in a deep relationship, with a family member, a friendship, your spouse and you think to yourself that you don’t need a written agreement – think again. If you are going to have any agreement drawn up always go through a lawyer. You can never tell if or when the other person is going to back off and leave you with the debts and responsibilities or if the other person is going to sell of their half of the partnership leaving you unprotected.

You may trust this person wholeheartedly and may never had cause to doubt them – but circumstances can and often do change. For example, I had a client who had all his monies tied up with his wife and their business. On Christmas Eve, she threw him out of the house and would not allow him to come back. Luckily, he had done as I had advised previously which was to put some money aside in a separate bank account. Had he not done this, he would not have had the money for a month’s deposit on a lease and he would have been out in the street.

You can be in a romantic relationship or a marriage and all of a sudden your partner goes to the bank and draws all your money and you are left with all the debts. And no matter how much you love someone, where there is money involved, make sure everything is spelled out really well. Make sure your lawyer has covered everything and you are not leaving any loopholes.

If you being asked to sign anything e.g. a husband of 30 years – make sure it a lawyer checks the paperwork. Ensure that someone can explain it to you and don’t be led like a lamb to the slaughter. In the end that partner may leave you, divorce you or die and may leave you with a lot of debt. You need to know what you are going to be responsible for.

Another important point to remember is that if anyone wants you to sign papers quickly, your answer has to be NO. Don’t ever allow yourself to be rushed into a financial agreement. No matter how good the deal might sound, you need time to assess whether it is right for you.

If you are ever asked to sign a lease, or a mortgage with your partner or spouse, make sure you understand it thoroughly. Take it to a lawyer. Make sure you can afford it, even if the incomes between you are reduced to one income. People have a tendency when they sign a lease or a mortgage, that they figure out how much they can afford to spend each month. What they DON’T calculate into these costs is a failing economy, or one of the partners being laid off or fired and out of work, or other expenses that go through the roof.

So if you are contemplating signing a lease or a mortgage with a partner, make sure you calculate it for just one income, because if you are basing it on two incomes in this economy you may find that you do not have enough money to cover the rent or the mortgage. You must ensure that your property is not foreclosed on you risk being evicted.

Don’t be embarrassed to tell your spouse or business partner that you want to speak to a lawyer to have him go over the fine print with you. When signing a legal document, many people don’t bother to read the fine print – or if they do bother to read the fine print, they don’t understand all the details. Wherever your money is being spent, that’s where you need to be very vigilant about your role in protecting it.