Fair budgeting for couples

angelofabundance

I earn considerably less than my partner, we want to look at our finances from scratch and re-arrange how we budget.
This might be a techie question.
What I want to know is how to make fair calculations that proportion our contributions.
For example if I earn £1000 and he earns £2000 our total income is £3000 but my contribution is 33% and his 66%.
Therefore if our gas bill is £60 per month then I can afford to pay £20 and he can afford to pay £40.
The figures we have are not quite as neat as this and so instructions of how to do this on Excel would be great.
Perhaps the site could provide a budget sheet in this format, it seems a fair way of doing things.

Tony_H_3

The first thing to do is establish who is liable for what % of the bills:

Add YS (your salary) "Cell C3" to PS (patners salary) "Cell C4" = AI (total income) "Cell C5"

then to work out your %

YS / (AI / 100) = YP (your percentage)

to work out partners %

PS / (AI / 100) = PP (partners percentage)

** These percentage results will appear as "%" in the cells with the formula, if you click on the insert menu then names --> define you can label your % as YP "Cell D3" & your partners % as PP "Cell D4". These names can then be included in future formulae.

Tony_H_3

Now you have worked out the % each should pay towards bills you can now use the defined names in your formulae to calculate each expense:



The cell range D3..E7 will contain your newly defined names YP & PP for each cell in the range the formula should look like this: I'll use "You / Partner & Gas" as an example.

Cell D4 formula = (C4 / 100) * YP

Cell E4 formula = (C4 / 100) * PP

flea72

so is budgetting fair, if you pay on percentages?

it still means that one of the couple, has alot more cash left at the end of the month than the other

do couples not share everything nowadays, is it always a case of whats yours is mine, and whats mines, my own, where the higher income is concerned?

Woby_Tide

similar to flea72's suggestion but we basically have an equal amount each per month as our 'spending' money, anything over that goes into joint accounts to pay all bills etc, anything left is for holidays and the like, we tried doing it other ways but too much hassle working out who pays what each month this way we both have our own cash to do what we want with and also generally we can put some savings aside to put towards a holiday without relying on each other not to have overspent each month! but every couple can be different so sometimes other ways work out better.

Darryl

We budget and share costs the way TonyH explains and angleofabundance suggests.

It works well and is easy to calculate if you have a spreadsheet. The only times when payments vary from my wife to me, is when mortgage rates change or we switch to cheaper utilties providers like good MSEs.

My wife makes a payment to me each month as I have most of the bills in my name. We don't have a joint account, and can't see the need to have one. We've also read too many scare stories about what can happen if you split up (not that we plan to - I hope). Also, if one of you is higher-rate tax payer, it can be better to have savings in the lower-rate payers name/account.

I guess the only debate we have is which items are fully proportionally shared, and which are equally split (like the mortgage, as we want to own the house 50:50)

Now, this could spark a whole new debate on these boards... i.e. should I pay for pet costs even though I don't want the pets we have?

Darryl.

flea72

so you split the mortgage 50:50, but split the bills, percentage wise?

how exactly does that have any bearing on ownership, when it comes to divorce proceedings?

what happens, when one of you no longer has an income, do you loose entitlement to your 'half' of the house, or will you work out percentage wise, how many years you have paid in, to work out what you get at the end?

Ok, in gonna generalise now, but unless the whole household income is shared on everything - then it is always the man who comes off better financially, as they usually are the higher wage earner, dont take time off to look after kids, and work full-time

i have seen many women, living on overdrafts/loans/cc, just because they have to split the bills equally - whilst their husband, has money left in their own account at the end of the month - in some cases, the husband goes on holiday alone, because the wife cannot afford to fund her 'half' of the holiday

its ok to split the bill on a date (or do people do that percentage wise too?), but when you are living with someone? - i just dont get it

angelofabundance

Thank you for the technical advice Tony this will make it much easier to work out.

angelofabundance

We do share everything and have worked on a system where he pays the mortgage and I pay for food, (similar amounts) but I would feel more secure if I can prove that I contribute to the mortgage as we are not married and the law is still a bit of a dinosaur where that is concerned.
The idea is that we will have the same amount of 'spends' from what is left after all the bills are paid and the rest will go on joint things like home maintenance and holidays.

Woby_Tide

angelofabundance wrote:

We do share everything and have worked on a system where he pays the mortgage and I pay for food, (similar amounts) .

:eek:

you've either a smallish mortgage or a BIIIIGGGG food bill;)

I'd be moving to a smaller house or I'd be 25st if we did that!:D

angelofabundance

Not quite 25st, but unfortunately going that way!
I am extravagant with food, I'd rather not eat than eat something I don't like and if I'm fanciful I buy.
Oh, that makes me sound like a right spoilt brat.