Ideas on splitting bills/expenses in relationships?

[Anonymous]

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@Anonymous wrote:

I'd like to hear more real numbers (budgeting data) from those that have sat down with their significant other and hammered out a plan.  I'm interested in the factors that went into the discussion and how the numbers were arrived at.  I'm assuming that a lot of these things were mentioned in my original post, but if there are other factors as well I'd very much like to hear about them!

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We are currently in the process of doing this. I can share a few significant factors so far in the discussion for us.

Many people recommend a joint account, but this isn't an option for us due to me still being in SSI. SSI requires a strict cap of total accounts never exceeding $2K. A joint account would mean that some money that's actually his, would be counted as mine, and if he accidentally put in too much or let it get too high then the bulk of my income stops and I'm threatened with jail time for failing to notice and report it. :/

We recently moved his trailer, which we plan to live in, to an RV rental spot that costs $200/month. Our goal with household rent and utilities is to split them 50/50, because that's what SSI requires to maintain my income. If he paid all of it, then SSI would proceed to decrease my income by what they etimate rent should cost, which is far more than 50% of my share. This will be the first time we truly have any shared bills.

So, what we've worked out is I will pay him $100/month for the spot, and then another $100/month for both utilities and the "rental" of his RV (repair/maintenence/etc). He pays for all the propane, too. If regular expenses are exceeding that amount, then we'll increase my contribution. But this is what we're starting out with.

He doesn't currently have a vehicle, so car insurance is just me. However, this is the first year I've had to include him on my car insurance. I always buy a year's worth at a time to get the discount, and coordinate that with credit card bonuses. When it turned out that I'd have to pay an extra $300 because he had forgotten about an incident 3 years ago, he made up the difference without a second thought. Otherwise, I paid the full amount because it was my car insurance, the insurance company was just forcing me to add him to it and there isn't anything he could do about it.

Some of the questions I find trickier to answer, like "net income each of us has at the end of the month" because he's been living almost exclusively off savings for nearly a year since the major car accident, and I make less than $800/month, much of what gets eaten by thousands of dollars' worth of necessary medical expenses that I'm stupidly forced to pay out of pocket.

I am proud to say we don't have any debt, though.

I know you're hoping to get more solid numbers, and I plan to come back and update this when I have those for you. But, what's really got us though is this basic philosophy that we're a team. If one is hurting, the other tries to help. We try to distribute the load in a way that feels fair to us. If it ever doesn't, someone speaks up and we talk about it. Right now I pay for all the gas, even though he also uses my car a lot, but he's paying for nearly all the groceries. As we get better at tracking expenses we'll get a better handle on how the numbers work out, but the point is we've fallen into a routine that works for us with separate finances, even if it's less exacting than preferred.

[stargazer25]

Data Points:

• He brings in over $100K, I am self employed $65-75K claimed personal income.
• Neither of us has credit card debt.
• Both have car payments.
• He has no student debt, I have a small amount that I could pay off in a pinch. (less than $5K)
• Rent we go 50/50. ($3,100 total). He pays all utilities and yells at me like an old man to "turn off the lights!". I pay for the houskeeping (bi-monthly) for my "half". We send our rent electronically to the landlord.
• We use one of his CC that I am an AU on for our going out fund. This used to be a big point of contention between us, since I am a bit loosey goosey for entertainment. Once we had to split the bill 50/50, that stopped really quick. We have budgeted $300 a month ($150 each). Same card is my "Oh **bleep**" card if for whatever reason I need a large amount of credit or my own cards declined. Thankfully neither scenario has ever happened. All major purchases go on this card to also be split 50/50. I send him money electronically since he pays the bills.
• We have an AMEX BCP together that we use for groceries b/c of the 6% cash back on groceries. He buys his own groceries and cooks for himself, my groceries are bought and cooked seperately. I have BCP on my own, but I still use the first one to help cover the annual fee on his card. He spends about $250-$300 a month, I spend about $400 a month in groceries. I have special dietary needs so we can't merge food bills.
• Since he makes significantly more money than I do, he is in charge of saving. With my business its feast or famine, so my money goes back into the business before it comes to me personally.
• I have to pay for my own private health insurance. That alone is $550 a month. I have too many health issues to go to a cheaper plan. I also pay on average an additional $400-500 a month in copays and co-insurance. His is covered by his company.
• There are a lot of expenses that I can charge against the business like coffee (since I buy for everyone), cell phone bill, car insurance, gas and other odds and ends that I charge against the business instead of my personal income.
• He doesn't buy anything, ever. I buy small things here and there. Even if he decided to blow $5K on a 4K TV on some insane deal, I wouldn't give him a hard time about it. He is so frugal. My thing is clothes. I am learning to flip my closet by buying and selling clothes on Poshmark to spend less money and get some back. If I blew $5K on say a bag, I'd hear about it. Understandably.

Back Story:

Both of us in our early 30's. He's a Type-A personality professionally and personally. 800+ credit score, money in the bank from working hard in his industry since early on. Me: Went from corporate paper flinging monkey to an industry that is similar to being a starving artist. It's a miracle that I am not living under a bridge. A year+ ago, I had bad credit (500 credit score), an old car and no credit cards to my name. Never racked up cc debt, just medical. Thanks to BF teaching me and myFico, I have late 600's credit score, a new car, 5 credit cards (incl. a business Amex) and a new appreciation for keeping track of bills, following budgets and not letting paperwork fall through the cracks and "forgetting" about them. My credit/money situation is still a work in progress but it's way better than it used to be.

He is also on on the forums, so.... hi honey!

[wallstreet177]

Our situation is pretty simple.  Our salaries are pretty similar in size.  We are not married yet but jointly own a home as of four months ago.  We split the mortgage, utilities and internet.  We mutually decided on a set amount to be direct deposited into a joint account in order to cover these expenses.  We added a little extra to cover other joint expenses such as vet bills and to start saving together. 

Everything else is seperate.  She has a small amount left of student loans.  We both have car payments and insurance.  We both pay our own CC bills but we talk about expenses that are more than typical spending like groceries.

Groceries we just take turns buying.  No strict rhyme or reason as to who buys groceries.  We don't always go together and if we do we dont split it.  

Thankfully neither of us go crazy on spending.

When we decided to live together we discussed all the different options (all seperate, all meshed together) and this seemed to be the easiest and best answer for our situation. 

[vanillabean]

Ditto to tcbofade. DW and I don't split, we share. All income goes into one pool, from which all expenses get paid. It's really simple.

We watched the Bank Book 6565696 episode of The Dick Van D y k e Show the other day. A hint of separate finances from 1962!

[oldman425]

My wife and I have been together for almost 30 years and when we had  joint accounts we fought all the time about money when I finally made us get seperate accounts and now we never fight about money.  She pays rent, her car payment and our car insurance and I pay everything else.

[sillykitty1]

First I'd like to back up Mishka, and agree, this comes across as pretty sexist.  And when she very nicely pointed it out, you just defended it instead of evauluating it at all.  By saying men tend to be logical, you're also saying women tend to be illogical, which is somewhat offensive.  I'm the numbers person and my now ex was the ideas person.  IME, relationships tend to be evenly split on who's more fiscally responsible.

I think a lot of men, myself included, tend to be logicial and analytical about this subject; I'm a numbers guy.  I like to crunch numbers and and arrive at a conclusion that way where women may tend to just shoot from the hip more or care less about it being "right" or whatever the would be.

1 - What income do each of you bring to the table

Both 6 figures, his approx 2x's mine

2 - What individual personal monthly bills do each of you pay (car loan, school loan, gym membership, car insurance, etc)

All bills are considered joint

3 - What combined bills do you have (electric, cable, rent/mortgage, heat, etc)

We combine mortgage, utilities, car payment(s), grocery, dining out, all spending on the house or household, clothing, insurance etc

4 - What net income each of you has at the end of the month after your income minus expenses

Significant amount of income leftover 

5 - Any DEBT that either of you currently possess

Nothing significant

So this is my recent past relationship I speak of.  When we decided to move into together we brought all financial information to the table and I built a spreadsheet and laid everything out.  

Here are the basics

• We considered most expenses joint, and we contributed to a joint account based upon income, so 2:1 
• I managed and paid all bills out of the joint accounts
• We had another joint account we both contributed to (2:1) that was for vacations, home improvements and general savings
• What was leftover was in our own accounts, and we could spend freely without having to question or explain (for example me: vacations separate from him & designer handbags, him: electronics and gambling)
• We viewed most things  as one, no my expense vs your expense.  For instance he had a VERY expensive car that was more than just the car payments, but high insurance, fuel, and maintenance, even though this isn't how I would choose to spend my money, this was considered joint as it was something we could afford and pleased him, and we both benefited from to a degree.  Similarly I have a pretty expensive wardrobe, combo of both need and taste, but because it is mostly work clothes we considered it a joint expense, when he was happy with Target t-shirts.
• From the everyday expense joint accounts the threshold for spending was pretty high, several hundred $'s, before consulting
• From the joint saving/vacation account all that spending was planned together

[iced]

1. What income do each of you bring to the table?

My gross pay is about $12,000/month. Hers is about $3,500/month. Bonuses, dividends, and the like aren't factored in budgets so when they come in they just go into investments, savings and/or slush funds.

2. What individual personal monthly bills do each of you pay (car loan, school loan, gym membership, car insurance, etc)?

I pay on a car loan, student loan, mortgage, gym membership, and cable/internet. These combined cost about $2,250/month.

She pays the various insurances, electricity/phone, and HOA fees. These combined cost about $450/month.

3. What combined bills do you have (electric, cable, rent/mortgage, heat, etc)?

Nothing is joint or combined.

4 - What net income each of you has at the end of the month after your income minus expenses

My net income is about $3,000/month, hers is around $1,500/month. After the expenses above, we have about $1.800/month for food and various living expenses. Starting this month, we're going to try to reduce this to $1,500/month so we can move more monthly income toward savings/investments. if that works, we'll try for $1,200 and so on till we can't. By then, the car and student loan should both be paid off so we can then divert that amount into savings as well.

5. Any DEBT that either of you currently possess.

Student loan, car loan, and mortgage only. Any excess spending/vacations in a month are put on CCs and paid in full through one of our slush funds/savings accounts.

[Anonymous]

I'm married.  The wife and I each make six figures.  Early in our marriage, we split the bills in half and each kept our 'personal' bills separate.  That worked fair enough, but we weren't saving much or paying down any significant debt.  A couple of years ago, we decided to truly combine forces and account for every penny.  Everything from our mortgage to our Netflix subscription is accounted for.  We have no individual bills.  Everything is considered a house hold expense.  We each get a 300 dollar allowance every month on the 15th to cover expenses and whatever. 

Every year in March we do our annual buget meeting to set the finacial gameplan.  I understand this wont work for everyone, but it suits us well.

Since we started tracking every expense, our finacial situation has improved significantly.  Our savings account got fat overnight, we contirbute properly to our retirement, and we've reduced 70k in debt.  Her credit scores are 750+ across the board, and I'm now 710-709-730. 

[Anonymous]

In my household, we split the bills up based on income. I make 3 times more than my boyfriend does, so I cover our biggest bills. He covers all of the small bills (lights, cable, grocery). We don't have a joint account so all of we are individually responsible for whatever debt we had in the past. 

[Anonymous]

I think this is one area in which contributions which are non-financial need to be weighted as heavily as do financial ones. For example, I know several stay at home dads who contribute a great deal from a non- financial perspective, and that means a great deal.

If we're going to weigh financial cotributions, we also need to just as equally weigh non- financial ones.