How to split bills with your partner?

Splitting finances as a couple is a sign of a healthy relationship. It helps one balance the cash flow and boost savings. If you and your partner earn well, you can do so easily. Whether you have a low-key or lavish lifestyle, some bills are important. For example- you cannot ignore rent, utility, and credit card payments. Regardless of the usage, you must pay for it.

However, you cannot pay each other’s credit card bills. You can still contribute to the major expense- Rent. It consumes nearly 30% of one’s income. It is for the individual paying it alone. Nevertheless, splitting the rental bill creates financial flexibility. It lightens up the burden on partners, and they grow well. 

Most couples seek valid ways to split the rent. You can either prefer a 50-50 strategy. Alternatively, you can pay the share according to your income. The blog lists some tips to split the rent well with your partner.

6 strategies to break the rent costs as a couple

Discussing finances openly with your partner is important. It helps you know each other’s financial situations. It could be debts, the bills you pay or the rent. It is the perfect opportunity to discuss your finances, life goals and lifestyle. Everyone has a unique way to live and spend. Including your partner requires acknowledgement. Moreover, decide the expenses to split if moving in together. Here are other ways to split the rent as a couple:

1) Calculate the total monthly expense

The shared living costs are less than living alone. Calculate the amount you must incur by the month’s end. You two may share different liabilities. For example, you may have an ongoing emergency fund that your partner lacks. Alternatively, your partner may have car loan repayments to make. These are two different expenses. You can split these if you can trust the other person with your finances.

Otherwise, analyse the usual living expenses as mentioned. Check whether you can carry the bill alone. If not, check how much the other should contribute to settle the dues.

2) Identify the amount you both earn

Earnings are one of the best ways to identify the payment capacity. Qualification, education, expertise and skills determine the earnings. Keep your and your partner’s income aside. Align it with the monthly expenses. Check how much you can spend towards each bill. It is after meeting your individual liabilities.

For example, if you earn £30000 with £5000 in savings, you can contribute less than one earning £65000 with £5000 in savings. Moreover, the one with high income has more tax liabilities. Identify and split the bills accordingly.

Breaking up the liabilities is different from living alone. Only you are responsible for the payments. It is the reason individual renters struggle and face debts. However, you can avoid this with instant payment. Options like a loan without a guarantor requirement might help. It is the best way to counter a bill without delay. Moreover, you don’t need a guarantor to support the payments. Instead, well-earning individuals may get one immediately.

Alternatively, splitting each bill as a couple is challenging. Take some time to understand each expense and reduce unnecessary expenses. It will help you re-define each share of payments.

3) Manage shared costs with a joint account

Yes, setting up a joint account helps split the living costs. You may break the bills like- energy costs, water, electricity, rent, etc. The partners contribute equally to the specific bill. It could be rent or groceries.

You must contribute the payment to the joint account before the billing date. It helps one avoid penalties and retain the rental space. Moreover, timely rent payments keep the landlord from increasing the rent. Calculate how much you two owe on each expense. It will help you budget for it accordingly. 

4) Set direct debits on each income-account

Direct debit is a facility that deducts the payment automatically. You can set one up with a personal bank account where you receive your monthly pay. Schedule the direct debit before the bill deadline. Check for the pre-payment penalty, if (any). 

Setting direct debits prevents one from budgeting for every need. However, you must ensure more than the minimum payment. Otherwise, the direct debit would not work. You and your partner may set one for the bill payments.

5) Split the bill 50-50

It is one strategy to reduce overhead liabilities. It is ideal for individuals with nearly equal income or savings. It helps you dedicate the costs equally towards payment.

For example- you earn £45000 each with similar savings. You will split each bill equally. If your rental costs – £200000, you pay £10000 each. However, if the bill is £25000, you can each pay £12000. The one with more savings can contribute to the extra £500.

You can design your billing structure this way. Timely bill payment requires timely income. One partner may face late payment issues. It may happen sometimes. Thus, this may affect your plan drastically. Moreover, re-calculation makes one skip some payments. Thus, it may attract penalties.

Individuals can avoid penalties with weekly payday loans immediately. It is a type of income-based loan with a weekly repayment cycle. It is ideal for regular earners facing late salary issues. You can get one just by revealing the salary slip. You can merge the amount from your side to the payments. However, do it the moment you fear attracting emergencies. Yes, you can get the funds the same day.

6) Try a 40-60 split method

Yes, it is another way to split the billing costs. It is ideal if one of you earns less than the other. You can dedicate a part of your savings to groceries. Alternatively, the better half may manage the rest. You can plan the lowest expenses to incur on your part. 

It may include utility bills, subscriptions, or cable costs. Your partner may pay for groceries, credit cards and rent. If you want, you can split some rent percentages. It will help you pay the share that you can genuinely afford.

Bottom line

Bills continue to be a distressful aspect of your lifestyle. However, splitting it up with your partner makes things easy. It increases your baseline savings. You can contribute towards mutual or individual goals. Additionally, setting up direct debits or joint accounts helps. It prevents you from skipping any bill payment. You can instead plan it together before the deadline.