Splitting the bills?

Crap_with_money.com

Morning all!!

I'm a newbie to this board (usually hang out in the DFW board), but my OH and I have decided to move in together later in the year, and I wanted a wee tad advice, so I was hoping you lovely people would be able to help!!

We're looking at moving in together in August. We're debating at the mo on how best to split the bills, and I just wondered how everyone else does it?

Obviously my first reaction is simply to split it down the middle. However, he thinks it should be split with him paying 75% and me paying 25%. The reason being that he does, and will continue to have a steady, reasonably well paid job, where I'm going back to uni, so will be without an income for the first year we're living together.

I'm obviously hoping to have a good wee bit saved, and will also have a student loan etc while I'm at uni, but to contribute exactly half will stretch me quite a bit. Is it taking advantage to allow him to pay more than half?

By his reckoning, he lives in rented accomodation just now, and by moving in with me, even in paying 75% of the outgoings, he will still be paying less than he is now, but will have the added advantage of having his own flat rather than just a room, and also be living with me. I can see his logic, but I still worry that it's a bit unfair on him.......

Anyway - what do you all think? And how does everyone else split it?

xx

poppysarah

What income will you have? 50:50 sounds fair and equal unless you're going to struggle massively.

mouche

Hi...OH and I have been married 3 years now and this is how we've done it from the start:

1) Figure out our total household expenses for the month (including rent, bills, groceries, eating out, cleaning materials, gifts for common friends, holiday savings)
2) Figure out our joint income
3) See the percentage of the joint income each of us makes (when we started I was making 70% but his salary has increased gradually and now we're almost 50-50)
4) Calculate that percentage of the household expenses and each of us contribute accordingly (so if our household expenses were £1000, initially I'd put £700 in the pot but now it's more like £500)
5) What we also do is decide a fixed amount we want to save each month and apply the same principle on contributing to the savings.
6) Whatever is left is our 'pocket money' to spend as we like. For a long time we had very little pocket money but we're happy to stuck to the plan because now we have a decent savings pot while friends who spent first/ saved later are now struggling.

even though you won't have any income as a student, it's worthwhile making a budget for yourself. Pay yourself a monthly salary from your savings/ student loan and stick to the same amount every month (no raises while you're a student!). And do the above calculations based on your salary.

Hope that helps.

lolarentt

My partner and I split the main utility bills - she pays some, I pay others, this has the advantage that we both have our name and address on bills if these are required for reference/finance checks etc. Other than that we agreed a division (based on the higher earner paying more) when we first started, about 8 years ago, and have pretty well kept to this with the occasional adjustment if one of us seems to be getting too good a deal! We kept our own individual bank accounts but have an extra joint account which we use for spare cash, odd cheques that come in, ebay sales etc and this is used as a holiday fund

Crap_with_money.com

poppysarah wrote: »

What income will you have? 50:50 sounds fair and equal unless you're going to struggle massively.

It's likely I won't have any income at all other than my student loan whilst I'm actually at uni. I'm going back to do teacher training, which from what I've been told is a very demanding course, and everyone I've known who's done it, has struggled to keep up a part-time job as well.

I've been working at clearing as much debt as possible (I was more than a tad frivolous when I was younger - but I've learned my lesson the hard way!! ) - I haven't got rid of my debt entirely, but it's now a lot more manageable. Anyway, that's going off at a tangeant - meant as an explanation to why I don't actually have savings yet.....

My plan for now, is to take on at least one part-time job (possibly 2, depending on whether one of them comes off, as well as hopefully finding some kids to tutor in my degree subject), and to save as much as possible from those earnings as well as the basic salary/commission I earn in my full-time job.

I'm thinking that if I get a job at weekends, I'll keep it on for as long as possible whilst I'm at uni. If I manage to keep it on right the way through, I won't struggle at all with paying 50:50, but if, like others, it proves to be too much on top of my uni/school workload, I wouldn't be able to fund 50% of the household bills without using credit cards/overdrafts - which is something I'd rather avoid if I can!

I could continue to live at home with my mum, which is a much cheaper option, but OH and I would much prefer it if we were able to manage to live together - which I think is why he's happy to pay more, but again, I'm just wary of taking advantage......

xx

Crap_with_money.com

mouche wrote: »

Hi...OH and I have been married 3 years now and this is how we've done it from the start:

1) Figure out our total household expenses for the month (including rent, bills, groceries, eating out, cleaning materials, gifts for common friends, holiday savings)
2) Figure out our joint income
3) See the percentage of the joint income each of us makes (when we started I was making 70% but his salary has increased gradually and now we're almost 50-50)
4) Calculate that percentage of the household expenses and each of us contribute accordingly (so if our household expenses were £1000, initially I'd put £700 in the pot but now it's more like £500)
5) What we also do is decide a fixed amount we want to save each month and apply the same principle on contributing to the savings.
6) Whatever is left is our 'pocket money' to spend as we like. For a long time we had very little pocket money but we're happy to stuck to the plan because now we have a decent savings pot while friends who spent first/ saved later are now struggling.

even though you won't have any income as a student, it's worthwhile making a budget for yourself. Pay yourself a monthly salary from your savings/ student loan and stick to the same amount every month (no raises while you're a student!). And do the above calculations based on your salary.

Hope that helps.

Thanks Mouche - that actually does make a lot of sense - and is pretty much what he's suggesting we do, in that we'll both still contribute, but only at a level we can each afford - so that he's not off living the life of riley with all his spare cash, whilst I'm sat at home too poor to eat!

I just always assumed that most couples would split everything equally - but maybe not!

Thanks for the replies - I'll defo bear it in mind when I'm mulling everything over!!

xx

daleigha

we have a joint account for all the bills, and i pay more into it as i earn more. i would feel terrible if i had loads of money leftover to play with each month and OH hardly had any - this is probably the way your OH is thinking!!

base your calculations on not having a PT job and see how that leaves you both each month, and then any money you get from a PT job will be a bonus!

good luck!

xx

flea72

tbh, i think all income should be pooled and used to pay bills and then any surplus should be split 50/50

by following this plan, then you wont have to make any allowances for changes in circumstances in the future, and neither of you will feel hard done by if incomes change. ie, when you leave uni, and hopefully have a higher income, then both of you will benefit. or should you have children, one income will drop to virtually nil, and both of you have to deal with the drop in income

Having spoken to friends who share the bills in proportion to their wages, its invariably the woman who comes out worst off financially, espec when she takes a career break to have kids. For someone working f/t to be able to keep 25% off their pay for 'spends' sounds quite reasonable, but when their partner working p/t also gets to keep 25% of their pay its not exactly an equal partnersip is it.

Tbh it causes less friction to have the money plan set in stone from day one, than have to reassess it, each time your financial situation changes. If splitting proportionally, there will come a time, when the lower earner, will have to ask the high earner for some money, and depending on how each of you view 'your' money, it will be a make or break situation

Flea

Mr_Matey

mouche wrote: »

Hi...OH and I have been married 3 years now and this is how we've done it from the start:

1) Figure out our total household expenses for the month (including rent, bills, groceries, eating out, cleaning materials, gifts for common friends, holiday savings)
2) Figure out our joint income
3) See the percentage of the joint income each of us makes (when we started I was making 70% but his salary has increased gradually and now we're almost 50-50)
4) Calculate that percentage of the household expenses and each of us contribute accordingly (so if our household expenses were £1000, initially I'd put £700 in the pot but now it's more like £500)
5) What we also do is decide a fixed amount we want to save each month and apply the same principle on contributing to the savings.
6) Whatever is left is our 'pocket money' to spend as we like. For a long time we had very little pocket money but we're happy to stuck to the plan because now we have a decent savings pot while friends who spent first/ saved later are now struggling.

even though you won't have any income as a student, it's worthwhile making a budget for yourself. Pay yourself a monthly salary from your savings/ student loan and stick to the same amount every month (no raises while you're a student!). And do the above calculations based on your salary.

Hope that helps.

hi cwm.com,
This is almost exactly what I do with my partner, the reason being she's just out of uni and I'm on a pretty decent wage and there's no way she could afford to live our lifestyle on a grad salary.

I keep track of all expenditure and we pay a percentage based on after tax incomes. That's usually me paying about 70%, which isn't too bad since before she got her job it was 100%! We do this for everything apart from personal spending - eg if she wants to buy a handbag, I buy a coat or we get each other presents.

It works for us because she doesn't want to feel like she's using "my money" when buying stuff, and she wants to send some money to her parents.

A simple way would be to have a bank account for bills which you can use for everything except discretionary spending. Keep it topped up, and see how much it goes down in a month to work out your expenditure. Then each transfer your share of the bills into this account.

You will have to revisit the situation if circumstances change massively (e.g. having kids, redundancy).

I think Flea's advice can only be applied if you're married. Splitting savings after expenses 50:50 is not fair if you break up.

sarah_elton

Also try posting this on the Moneysaving in Marriages, Relationships etc board - there's quite a few threads on this topic over there.

inmypocketnottheirs

flea72 wrote: »

tbh, i think all income should be pooled and used to pay bills and then any surplus should be split 50/50

by following this plan, then you wont have to make any allowances for changes in circumstances in the future, and neither of you will feel hard done by if incomes change. ie, when you leave uni, and hopefully have a higher income, then both of you will benefit. or should you have children, one income will drop to virtually nil, and both of you have to deal with the drop in income

Having spoken to friends who share the bills in proportion to their wages, its invariably the woman who comes out worst off financially, espec when she takes a career break to have kids. For someone working f/t to be able to keep 25% off their pay for 'spends' sounds quite reasonable, but when their partner working p/t also gets to keep 25% of their pay its not exactly an equal partnersip is it.

Tbh it causes less friction to have the money plan set in stone from day one, than have to reassess it, each time your financial situation changes. If splitting proportionally, there will come a time, when the lower earner, will have to ask the high earner for some money, and depending on how each of you view 'your' money, it will be a make or break situation

Flea

That's exactly what me and Mrs IMPNT do. It works very well and it stops the petty I paid this, you paid that mentality that a lot of our friends who used other methods in the early days of their relationships.