Joint household budgeting conundrum - any takers?

Zanderman

bpk101 said:

Zanderman said:

I share the view that such splitting seems odd. I cannot see the logic of one person paying a higher proportion of bills just because they earn more.  Do they eat more too?  Have more showers?  Use more loo roll?  If the house is shared it is shared, surely? 

The only way i can explain or rationalise this approach is to give an example…

Person A – who might earn 2 or 3 times that of Person B – would rightly so like to enjoy the rewards of their comfortable hard-earned income and splash out the new super premium Netflix platinum subscription costing £100 a month (it doesn’t exist but you get the general idea).

Person B however is struggling to meet the cost of it based on an equal 50/50 split even though they'll inevitably use it. But at the same time doesn’t feel it’s fair to simply say no and limit Person A’s enjoyment just because Person B earns less. 

Therefore Persons A and B put their incomes together, pay for the premium service from the combined joint income, thus contributing equal amounts in proportion to what they both earn. I.e. the same system i'm describing.

Well, it depends, obviously, on the nature of the relationship.

If the two are merely sharing a house, and are otherwise independent of each other I see your point. 

If the two are living together as a couple, and intend to stay that way, then surely Person A & Person B pool the money earned as a couple.  In which case it doesn't matter who earns what.  It's not each person paying half the bills (and perhaps one being unable to afford 50%) it's the entire household income being pooled upfront - before the bills are paid. No split necessary as there's nothing to split.  And if, from the total household income, they can afford to buy the premium monthly TV service at £100 a month they can.

In my career and my spousal partnership, our incomes have rocked to and fro - sometimes I'm ahead, sometimes the Mrs is. A few years ago the differences were quite large. But we always pooled, as we were sharing our lives. 

But others do things differently!

bpk101

Zanderman said:

If the two are living together as a couple, and intend to stay that way, then surely Person A & Person B pool the money earned as a couple.  In which case it doesn't matter who earns what.  It's not each person paying half the bills (and perhaps one being unable to afford 50%) it's the entire household income being pooled upfront - before the bills are paid. No split necessary as there's nothing to split.  And if, from the total household income, they can afford to buy the premium monthly TV service at £100 a month they can.

Okay, but say at a point when you were earning a lot less you wanted to buy Mrs. Z a rather special gift (some jewellery for an anniversary perhaps), does that come out of the joint account too, the account that Mrs. Z has contributed the lion's share too?

Now suppose that salary imbalance has been a feature of your relationship for 10+ years, would you feel comfortable using the joint income to pay for that gift... and every other gift you give her?

Ebe_Scrooge

bpk101 said:

Zanderman said:

If the two are living together as a couple, and intend to stay that way, then surely Person A & Person B pool the money earned as a couple.  In which case it doesn't matter who earns what.  It's not each person paying half the bills (and perhaps one being unable to afford 50%) it's the entire household income being pooled upfront - before the bills are paid. No split necessary as there's nothing to split.  And if, from the total household income, they can afford to buy the premium monthly TV service at £100 a month they can.

Okay, but say at a point when you were earning a lot less you wanted to buy Mrs. Z a rather special gift (some jewellery for an anniversary perhaps), does that come out of the joint account too, the account that Mrs. Z has contributed the lion's share too?

Now suppose that salary imbalance has been a feature of your relationship for 10+ years, would you feel comfortable using the joint income to pay for that gift... and every other gift you give her?

OK, I do completely get your point, I understand totally where you're coming from.  And obviously, what suits one couple won't suit another.  And it depends to a large extent on the nature of your relationship - are you newly-weds, or have you been married for donkeys years and fully expect to remain so?

For what it's worth - for us, yes, everything gets pooled.  So yes, if she buys me a present, I've actually paid for it myself :-:smile: 

Like I say, that won't suit everyone's situation.  And our combined income is somewhat less than yours - whilst we're comfortable, it's not like we've got thousands in spare cash swilling around.  So our presents to each other tend to be very modest.

But if having a "personal pot" left after everything "household" has been paid, works for you - then great, I'm not knocking it.

jimpwarsop

eskbanker said:

As above, many work on the genuine partnership principle of 'what's yours is mine and what's mine is yours', but each to their own!

there isnt much point in a relationship if one sits down to fillet steak and the other opens a tin of beans.

Zanderman

bpk101 said:

Zanderman said:

If the two are living together as a couple, and intend to stay that way, then surely Person A & Person B pool the money earned as a couple.  In which case it doesn't matter who earns what.  It's not each person paying half the bills (and perhaps one being unable to afford 50%) it's the entire household income being pooled upfront - before the bills are paid. No split necessary as there's nothing to split.  And if, from the total household income, they can afford to buy the premium monthly TV service at £100 a month they can.

Okay, but say at a point when you were earning a lot less you wanted to buy Mrs. Z a rather special gift (some jewellery for an anniversary perhaps), does that come out of the joint account too, the account that Mrs. Z has contributed the lion's share too?

Now suppose that salary imbalance has been a feature of your relationship for 10+ years, would you feel comfortable using the joint income to pay for that gift... and every other gift you give her?

That's easy enough - you assign a fixed amount each month to personal accounts - personal spending money. 

Which can be equal, or unequal if you like.

Easily done.  And what we've done for decades.

Besides Mrs Z-man doesn't expect expensive gifts. She's already got me!

MalMonroe

If you are sharing a home, children, a bed and everything else, then sentences like this -

"I'm trying to work out a joint household budgeting system where the two individuals contributing are proportionally splitting the total cost of bills on a true and fair representation of their respective monthly take-home salaries."

and this -

"i.e. if Person A put's their full £200,000 into the pot and Person B put's there full £100,000 into the pot, and from that one family pot come out all of the family bills, then Person A's income has contributed to 66% of the bills and Person B's income has contributed 33% of the bills."
 
(particularly the parts in bold) are not only meaningless, they are disloyal and quite worrying. Especially as they are being directed at a bunch of strangers on an internet site. 

You need to speak to your partner, not us, if you have anything to say about any of your living circumstances.

Partnerships are about sharing. And I'm saying this from the stance of a divorced woman who was left to bring up a child alone. 

But I do believe that if you are in a relationship and you are raising a family together, whatever anyone brings into the household is totally irrelevant. You share. And you don't think about what you're sharing and how costs can be split.

I pity your poor partner who is obviously unaware of your disloyalty. It's a very sad situation altogether, imho.

*PS - it's 'puts their' not 'put's there'.

Exodi

MalMonroe said:

I pity your poor partner who is obviously unaware of your disloyalty. It's a very sad situation altogether, imho.

*PS - it's 'puts their' not 'put's there'.

What a load of complete nonsense, you should be ashamed of yourself for jumping to such absurd conclusions.

You know absolutely nothing of the OP's situation; whether they have children or not, whether they are married, how long they've been together, whether this arrangement is by the partner's request - yet you make offensive and judgemental statements like that?

EDIT: I believe it's already been confirmed that the OP is the lower earner in this situation FYI.

Very poor form from a regular forum-goer like yourself.

eskbanker

bpk101 said:

eskbanker said:

If you're going down that route (and it would be anathema to many)

Why would many find this route dislikable? 

Well, now you have your answer to that!  Although my conscience is clear in that I did actually answer your original question, I hadn't anticipated that the passing reference to other ways of handling lopsided incomes would result in some of the dogmatic posts that have followed, so apologies for inadvertently triggering a pile-on....

bpk101

Ebe_Scrooge said:

OK, I do completely get your point, I understand totally where you're coming from.  And obviously, what suits one couple won't suit another.  And it depends to a large extent on the nature of your relationship - are you newly-weds, or have you been married for donkeys years and fully expect to remain so?

Lived together for 10 years (married for 5 of those) and up until now – despite the ever-present imbalance in salaries, weighted towards my partner – we've split everything 50/50. Now call it stupid male pride but as the lower earner in the relationship i've always insisted on a 50/50 split feeling anything less would be neglecting my responsibilities as an equal partner.

In reality – and as the gap between our freelance vs. corporate career ladder-climbing salaries increases more and more – the 50/50 method causes more issues than it solves as i find myself putting the breaks on expensive joint purchases that can often cancel out any personal money i have left at the end of the month to do things like save for gifts.

By establishing a system where we both contribute an equal proportion of our salaries to joint household expenses means we can move forwards without limits bought on by these disproportionate earnings and ultimately live more freely, together. 

JosephK

Old acronym -K.I.S.S. (keep it simple, stupid) Anything much more than putting both incomes in the "pot" and then, after  budgeting for bills, necessities, etc., each using as required is over-complicating a household budget.