How Do Independent Couples Divide Up Expenses? |
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My fiancee and I have very independent personalities. When we met eachother, we each owned our own property. We each have fairly successful careers, though I must admit that her's is taking off a bit more than mine. While we lived together in Boston, we split expenses more or less 50-50.
When we moved cross country for her promotion, we did talk a little bit about money. She offered to help with some of the expenses that occurred due to the move including the negative cash flow property that resulted. However, she was concerned in helping out so much that I'll go out and buy a jet ski (her joking sarcasim), while I was somewhat concerned that she'd spend the extra money on designer purses (my joking sarcasim).
I was on board with continuing the 50-50 split until I realized exactly how much of a breadwinner she will be and how much less I'll take home with the increased expenses. I came up the idea using each of contributions of our total net income to figure out how we should divide up our expenses. She brings home 57.6% of the income, so I suggested she paid 57.6% of the expenses. After doing the math, she'll still take home a good deal more than me each month. After all, she makes more money, she should enjoy it.
I'm curious as to what others would do. Do you think this is a fair split? This will become a moot point once we get married - or at least that's the current plan.
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My wife and I also ended up splitting expenses based on our income, since it seemed like the fair way to do it. To make things easier, I paid the mortgage and she paid the other monthly bills. Of course, none of that matters now since we are a one income family these days. :)
While the concept is fair, I think calculating it out to one decimal point is a bit nitpicky for people who presumably love each other, intend to marry and see their relationship as a partnership. My hubby makes more money than me and I have student loans to pay off whereas he doesn’t. Based on those two things, we agreed he would shoulder more of the financial load. That said, we didn’t calculate anything. We just agreed that he will pay the mortgage and I will pay any other bills.
Good point GeckoGirl. It’s actually something like 10 decimal points, I just saved you the details :-)
We do our expenses via a spreadsheet and have done so since we moved in. The split was 50-50 at the time and it was built into the system. It took me less than two minutes to integrate the exact math. I think the decimal point is just force of habit. We might very well just do the split of someone pays the mortgage and someone pays everything else.
The really odd thing is that I have never balanced my checkbook and I can’t find my way around Quicken, but for some reason the spreadsheet works for me.
Im in the same boat as you, except that we’re married. The bottom line is that marriage is a financial partnership, and accordingly Im a strong believer in a 50-50 split on all things financial. If you want the jet ski or she wants the purses, discuss it and work toward mutually shared financial goals. I dont think that spending should be pro-rated based on earning power (and I dont say that just because my wife makes 10x what I do; we had this arrangement back before she hit the bigtime.)
I think once we are married we will go 50-50 as well. The thing is that I moved across the country for her job and acquired extra expenses in the process. Because we haven’t completed the merger (as they might say on Survivor), we haven’t yet put our financial goals on paper as I would like.
She’s also not the type to really plan things out long term. She makes all the good short term moves, but she doesn’t have a plan of where she wanted to be in 5 years, 10 years, etc. as I do.
And, of course, now I’m curious as to what you and your wife do :-).
Im an attorney, and my wife works at a hedge fund.
He makes slightly more than I do – maybe 30% more – and we split it in proportion to how much we bring in. So, he covers 30% more of the bills. It works for us. We both still get spending money – he just gets 30% more than I do.
I think that’s the plan. It’s good to know that it’s working out for you.
And while I’m here, Who says there aren’t any wealthy PF Bloggers? Miserly Bastard seems be doing okay.
[...] How Do Independent Couples Divide Up Expenses? at Lazy Man and Money A look at how couples split their expenses. Surprisingly, I’ve never spent much time on this issue. It seems to come naturally for me and my wife even before we married. [...]
I agree with Frugal Frugalson , I pay the mortgage and my spouse pays for all other expenses ie water, cable, gas etc
By me being the breadwinner I just took on the highest bill which was the mortgage.
[...] that to the method outlined here last October, How Do Independent Couples Divide Up Expenses?. Specifically, “I came up the idea using each of contributions of our total net income to [...]
[...] how do independent couples divide up expenses – I’d probably do what lazy posted here, although I’ve always wondered whether I’d feel the same way if the other party earned significantly more or less [...]