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I have been officially living with my boyfriend for over a year now and boy, have we learned a lot about each other.  Having dated him for six years prior to living together, I had thought I knew him well.  We are cohabitating right now.

Let’s just say that I know him even better now!

My Experience

In case you don’t remember, I have been managing our day to day joint finances.  We have our own individual accounts and a shared joint account and a shared credit card.  Things that get charged on the credit card are groceries, cable, and other joint expenses.  Things that get deducted from our joint account are the mortgage, hydro and gas bill, and other joint expenses.  We had split things like the mortgage and groceries in half.

My boyfriend likes the home warm and I was shocked at our hydro bill (our home is heated throughout by electric baseboard heating) this last winter.  Since my boyfriend liked it warm, and I was a poor starving student, I suggested that he pay 60% of the hydro bill and I pay 40% of the hydro bill.  Also, since he watches television and since I use the internet predominantly, I suggested that he pay the cable and I pay for the internet (though this is difficult to separate since both are in a “bundle” with Shaw cable).

There were times when I felt like I was being taken advantage of but as time went on and as I would tell him he owed the joint account $67.13 to the penny (yes, isn’t this terrible?), I realized that loving someone is about giving and it’s not about 50/50 arrangement or being “tit for tat”.  I’m sure that there were times when my boyfriend felt like he was being taken advantage of too.  Because our payment arrangement for bills etc. was so clearly defined, at times it felt like we were being roommates.

What was next, his and her groceries?  We split the meat and milk and he pays for his man snacks (chips, energy bars etc.), and I pay for my woman snacks (chocolate, chips)? LOL.


Where does this divisive nature of the bills end?

Personally, I think that a divisive nature towards expenses incurred together breeds selfishness and being selfish and having a genuinely loving relationship are mutually exclusive.  I know that many people out there will disagree with this statement.

I have a friend who cohabitated with her boyfriend for about three years.  They split everything down 50/50 as well to the point that even when they went out, they would always pay for their own share for meals and entertainment.  It was down to the penny (okay, maybe I exaggerrate, but they went Dutch all the time without one paying for the other and saying “you can treat me next time”… always Dutch).  My girlfriend had told me that he liked separating their finances this way because that’s the way he has always done it with a previous cohabitating relationship.  She felt that he was being selfish and she didn’t feel loved.  When he would tell her she owed this and that to him, she felt that he didn’t love her.

Needless to say, my girlfriend wanted out of the relationship and despite him thinking about proposing to her, she rejected him and left to find someone who would be less “split down the middle” and be less, dare I say “cheap”.


Who Would this Work For?

The title of this post indicated that the equal division of expenses doesn’t work for everyone.  I think it might work for some couples though.  It might work for couples where the individuals are both avid practitioners of “Guerilla frugality” (love this term coined by Findependence Day).  It might work for couples where both of their parents practiced this way (though that might be rare since our baby boomer parents grew up like in nuclear families where there was often a stay at home mom).

The Solution?

My boyfriend and I now just divide our credit card bill in half so that it is easier to calculate.  Everything is 50/50 (instead of 60/40 or he pays cable and I pay internet) and when we go out, we don’t pay for “our share” only anymore.  We take turns but we’re not anal about whose turn it is to treat.

Other ways that it might work is one person pay for the mortgage and the other person pays for the monthly day to day expenses like groceries and utilities.

The shift in my thinking has been drastic.  No longer do I think “oh, I shouldn’t have to be paying for any portion of cable since I don’t watch it”.  It’s not “you owe” and “I owe” anymore, it’s “we” and we’re a team!  Our relationship has gotten about infinitely better since I adopted this mindset.

Readers, how do you work out your finances?  Have you changed the way you organize your finances to something that works better for the both of you?

Article comments

JenSmith says:

I just got married 6 weeks ago I make six figures husband (so weird) makes $0. He’s still in school. I don’t mind thinking of money as our money but then I want to see all financial paperwork. I want to be in on all decisions. I want to know where every penny goes. I don’t judge him for getting new clothes. God knows he needs them but don’t spend $400 and not tell me.

My two friends had very disparate salaries when they were living together – their solution was not 50/50. It was 80/20 since her salary was 4x higher than his. So they paid an = percentage of their salaries. So the “cost to each” was equal but the $$ amount was different.

getagrip says:

Well, you can call it cohabitating, shacking up, whatever, but right now there is no real legal commitment between you so yeah, you’re pretty much roommates and whatever you agree on is what it is. My wife and I had discussed moving in together before getting married and decided we would go with income percentage for the general bills and savings, and then a set amount for allowance for each. But then things worked out that we got married prior to moving in together and we just merged everything. I can’t say how the plan would have worked because we never executed it.

As someone else said, once legally married there are differences, especially if one person earns more or another has an expensive hobby, etc. But you know, life is change and more important than having some ironclad way of doing things is being able to communicate when the ironclad way you’ve been operating for X number of years isn’t working for one of you. Over the years we went from boht working full time, to back to school, to stay at home parent, to part time work, etc. So there were plenty of issues to discuss and consider and how the money gets handled needs to change with those times as well.

What a coincidence that I came across your blog tonight (via a lot of blog hoppin’!). I just wrote about this exact topic on my blog a few days ago as well!

My then boyfriend and I lived for 4 years with separate everything. In this case, he was the one who tallied everything and told me how much I owed. Even though he is completely objective when it comes to these things, I hated those moments when I would say, “oh, you owe me $5 for ____” and he would say, “actually, you owe me $5 for ____”. It felt so unromantic…. Granted, it did work well in many respects but I am glad that we have (partially) joined our finances now.

I’m surprised that no one has mentioned the arrangement we’ve adopted. I thought it was common at first but more and more we’re discovering it’s not. My husband and I put the same percentage of our salaries into our joint and personal accounts. That way, if our salaries decrease/increase, we are still contributing proportionally. It also means we don’t have to figure out what % of each expense we each need to contribute.

young says:

@LIndsay- So the “then boyfriend” is he an ex boyfriend or is he your husband now? 🙂

That sounds like a good solution/ alternative. Can you elaborate on the same percentage of your salaries into joint and personal?

e.g. You put 60% into joint and 40% into personal?
He puts 60% into joint and 40% into personal?

That sounds like a good solution and I will definitely be exploring this later on.

eemusings says:

We’ve gone from fully mingled to some joint, some separate, and are now back to pretty much merged, with me handling the finances.

I can see good reasons to keep finances separate, but we’re one of the couples that finds joint finances work much better for us.

young says:

@eemusings- Thanks for sharing your experiences!

Sally says:

Absolutely do NOT adopt a procedure whereby one person pays the mortgage and the other pays other bills. Unless you are legally married, not common-law, if you split up you must prove contribution (ie. exactly what bills you paid and contributed) and if only one person paid the mortgage the presumption is that person gets the credit for that asset and increase in the equity!! It is even worse if the partner who made the mortgage payments went bankrupt. The person who was paying all the other expenses may lose their entire share of the downpayment, plus all the increase in equity. IF you are common-law (or haven’t met that threshold but are paying expenses jointly) Do NOT under any circumstances have one person pay the mortgage.

young says:

@Sally- Thanks Sally! Sorry I meant to say that this situation should work if you were married (e.g. one person pays mortgage other pays bills) but I agree, if you are common law, it is important to maintain proper division of common property.

My BF and I do NOT do the “one person pays mortgage other pays bills” and that’s why we have divided it 50/50 for the property.

Pursuit99 says:

This is a great topic and even after two marriages (one twenty-five years) and this, my second, incredibly happy seven years and forever-more one, I have to say “thar still be dragons” to slay. It’s a challenge when one earns more than the other and priorities differ – eg. new appliances vs golf memberships. Life really takes a turn after the babies arrive because the financial impact (as in loss of income) on the one who stays home (usually the mom) is much greater. I don’t have the answers but I would strongly recommend all the big stuff come out of a joint account to which each contributes a proportion. Each needs their own play/personal account as well.

Most importantly, both partners need to be involved in managing the finances – even if one can claim more expertise. You need to be able to determine where the money is going – always. Otherwise, some rather bad habits can erode that little retirement/holiday/future home fund: on-line gambling, high risk investing, or some little cosy hide-away for two, one of which is not you…. These are not happy things to have to consider; do think twice if your partner gets vague and defensive when the topic comes up – been there once, never plan to be there again!

young says:

@Pursuit- Thank you so much for sharing! Ugh.. cosy hideaway for two, one of which is not you sounds like a total nightmare. I agree- both need to be involved. I think traditionally (I’m going to be stereotypical here), women are “afraid” of managing money, and because most women are usually the SAHM and usually sacrifice the income to raise children, I think women are at a great disadvantage to not know where the money is going.

I think it’s important in terms of maintenance of power for women to be informed about money, and not simply trust all the money to be managed by the spouse.

I’m sure it works the other way too, but I think that women not managing the money is more common than the other way round.

Liquid says:

Not in a relationship yet so hard to say what I would do. I think it will depend on her upbringing like you mentioned since she’ll probably be comfortable doing what her parents did :). I’m flexible on this subject as long as we keep it simple. Thanks for sharing. Sounds like you and Mr. Y&T both learned a lot from each other.

Eddie says:

I’m glad to see that you’ve come around, and realizing that in the end you are a team. A couple that doesn’t work as a team, and instead concentrates on the little things (such as pennies) has a bleak future.

young says:

@Eddie- Thanks Eddie! I couldn’t “see” it then but I definitely see it now (after learning it the hard way).

young says:

@David- Thanks so much David for sharing your experience! Yes Cohabitation Agreements are a great idea and pretty much essential for every cohabitating relationship because it protects you. I have a post on this somewhere on my blog.

I am the same as you. I am a hardcore saving and investor and he is not. I always encourage him to pay more for the mortgage but he doesn’t see the same value in it. I’ve stopped the nagging though I’m sure he’ll turn the corner soon if he continues to see that he’s not been saving.

David says:

I have been with my partner ten years. Typical saver (me)/spender (him) relationship. For a long time he earned more than me, but we have always split basic expenses and some discretionary expenses 50/50, at first through a joint credit card, later adding a joint account when we got our first mortgage. I have never resented splitting expenses 50/50 and I prided myself in paying my half. We still have our own separate accounts as well, and investments are completely separate except for the house.

My financial concern in the relationship had more to do with the fact that I managed to invest and grow my net worth way more than my partner despite my lower income. It bothered me that if down the road we parted ways, I’d be the one handing over part of my assets despite the fact that I always had a lower income. As a result, I found myself nagging him and pushing him to invest more, and I saw that it could cause problems in the relationship in the long term.

The issue was put to rest five years ago with a cohabitation agreement stating that assets in our own names are ours to keep if we separate. I haven’t nagged him since. Some people found it odd that I suggested a cohabitation agreement five years into the relationship and assumed we were having problems, but we were in fact quite happy at the time…always have been and still are.

You just have to do whatever works best for you and your partner. There isn’t one solution that works for all couples.

krantcents says:

My wife and I rely on each other expertise. I am good at personal finance and she is good with medical and social issues. I think the best person at a particular skill should take the lead.

young says:

@krantcents- yes- good point too! My BF said he will let me manage his money (I have been itching to help him with his savings goals) once we get married haha.

mycancukbuck says:

Whew – sorting out money is a toughie. When Mr. Canuck Buck and I first moved in together, I tried to do everything 50-50. Which wasn’t really fair, b/c I made way more money than him. When we bought a house – I paid the mortgage, he covered utilities (most of them) and he gave me money each month to put towards a lump sum for the mortgage. We argued a lot about all the “extra” he spent, until I decided – as long as he could cover what he agreed to, we were good, and I wouldn’t worry about the rest.

young says:

@MCB- Thanks for sharing your experience, MCB- It is all about the mindset too. Having those thoughts e.g. getting annoyed about the extras is toxic to the relationship and just builds resentment. I know it did for me!

It all boils down to what you think is fair. If you and your boyfriend agree that your situation is fair and equitable, then, fine. Separate, joint, none of it matters as long as nobody gets their feelings hurt.

young says:

@Kathleen- well, I had thought it was fair at first but we changed our minds.. I guess we’ll be changing our minds again soon, who knows!

Etienne says:

Us, we divide in % according to our salary levels. I pay 60%, she pays 40% of everything that’s common or done together (goods, food, car, fuel, shelter, restaurants, vacation, etc). I pay 60% of her transit pass but she pays 40% of my gaz… I pay 60% of our common meal she pays 40% of that whole bill. Meaning if we eat the same thing, I pa a little bit of her food every time;)
We pay our personal stuff ourselves (health, clothing, nights with friends, little cravings, etc)

This is the only fair way IMO. If we’d split 50/50, she would be out of money every month and I’d have tons of leftover, this would put a strain on our couple as she would not be able to buy herself stuff or go out with friends. How we have it now, when we go on vacation she has less to save for the trip, but actually she has the same % so it bescome the same effort to have th emoney for the trip (which I’d pay 60% and her 40%)

Dividing 50/50 except if you have a similar salary, is calling for trouble. IMO you either put everything together (salary, expenses including personal ones) or you split according to salaries. I think after a certain length of time with the other you can put everything together as there is less and less notion of “personal” expenses. My parents are like that (and many other couples).. But sitll, IMO, it leads to a lot of tension sometimes, like when one person wants to buy a new thing (let’s say expensive watch), but the other one thinks it’s a silly expense. If they had their own “play” money they could buy whatever they want.

Since there are so many couples splitting, that notion needs to be thought about beforehand, and knowing already that if it happens both would have money on their side and that no one paid more than their fair share gives a peace of mind.

I’ve been with my girlfriend close to 4 years and we never, ever had a discussion, argument or even frown over money. We are both very, very happy of our setup and we always remind us that it’s worth the effort wverytime we have friend telling us that the other one pays not enough or spends too much or blablabla..

young says:

@Etienne- Thanks for sharing your own experience. That arrangement sounds very equitable and it obviously sounds like it works since you haven’t had an argument about money (since money is the number 1 thing couples fight about!).

I think that the partnership approach, where people operate in a unified manner where it’s “one for all, all for one”, seems to promote unity and togetherness. Scorekeeping and equal division seems to be more of a roommate arrangment.

That being said, I think that it might be more understandable for people not married to do it the way of equal division. After all, it’s not a legal union. However, when married, it seems like it just makes sense anyway to join everything because at least in some places, marital assets are joint anyway. So the his/hers separation is not only a hindrance to unity, but it might also be silly and pointless in reality.

Good post, and refreshing discussoin on this topic!

young says:

@The Money Knot- That’s true. I agree that it is important for the household aspects (e.g. split down the middle) especially if ownership of a home is involved (like in my scenario) but for things like groceries or utility bills or eating out it’s pretty silly to be so divisive like that.

lee says:

I’ve been following the YT blog for a while, and thanks for giving me the chance to pipe in!

I’ve been in now two co-habitating relationships and I think it’s always a bit of a progression. What has worked well for my boyfriend and me is that we keep all of our household receipts until the end of the month, when we tally them up and debit/credit the difference (when split down the middle) against the next rent cheque. This has worked for us because we both bring home about the same income, so it hasn’t been a problem (and has been infinitely easier and less cheap/petty as when in a previous relationship we kept a running tally on the fridge but he was working and I was a student).

Now that we’ve purchased a house, we have a joint bank account where we will put in a set equal amount in monthly to cover these expenses, but have not yet transitioned to having our paychecks deposited there (and soon to come is a joint cc, but we haven’t sorted out yet what the best way is to reduce the # of fees while maximizing the perks!). I reckon that when this gets too tedious, or we get married or have a kid, it will turn into all ‘our’ money. However if anyone has any ideas on how we would still contribute to our respective savings as well as have personal allowances I’d love to hear them!

Work in progress!

young says:

@lee- definitely a work in progress! Ughhh running tally on the fridge sounds awful. I guess that’s how I felt when we first moved in because I was playing the “victim card” that I was a student and he should pay for more…. it was a petty mindset, that’s for sure.

I also manage the finances in my household and all I do is add up the total family expenses (rent, groceries, electric, insurance, gas, car payment) and split it right down the middle. Every month we both put our allotted share into the joint savings account and we go from there. The only thing I’m paying extra for is our health insurance and the car repairs (because I drive our one car 90% of the time). I’m fine with paying those extras because I’m the one making more money these days, as he’s in his first year of owning his own business AND he helped me out like that when I was in school and he was working. Sometimes I get selfish feeling, mostly when I’m reviewing my budget and trying to squeeze more money into the debt repayment column, but relationships are more important than money!

I have a friend who does what you used to do and it definitely leads to a room mate mindset, in fact I think they’re going to break up soon…

young says:

@Jordann- ughhh… sorry to hear! Thanks for sharing your experiences. Yeah looking back I’m a bit ashamed that this was how I was acting. I though about money before relationships.

New Mom says:

We have “us, his, and her” accounts. Over the years, more of the money ends up in the “us” account. With a new baby, it is hard to divide things 50/50.

For example, when I was on maternity leave, I only received about 50% of my pay for 5 months. The baby is ours. So it would be unfair to expect me to pay for half of our shared expenses for when I carried the baby, labored, and cared for the newborn. And all the time I took off directly impacted my retirement. It would cause a lot of resentment in the marriage if the expectation was for me to continue paying 50% of the expenses.

And then when you add in the fact that my toddler prefers mom when she is sick (and babies get sick a lot when she is in daycare), I usually have to stay home with her for days at a time (I also have more sick leave saved up). This in turn means my career has stalled, whereas my husband’s career is is still moving upwards. For something like this, you can’t expect a 50% relationship in a good marriage.

Helly says:

Ah yes, money. I think that when you’re a cohabitating boyfriend/girlfriend, then it’s prudent to divide things equally. I’ve had my share of boyfriends who were “fortune hunters” and out to take advantage of women (and I’ve also encountered a fair number of gold-digging girls who dated my male friends, as well), so I’m personally a little sensitive to that sort of thing, and would prefer to be careful about it. If a guy doesn’t like splitting things like that, then that’s his problem.

Once you’re married, however, I think the game changes up a bit. There’s more of a binding sense of unity and “us” that should also be reflected in the finances.

My hubby and I solved this problem of balancing independence vs. joint finances by pooling the majority of our income into our joint bank account, which is used for joint expenses: bills, mortgage, groceries, eating out, etc… But we also take out a small, fixed portion of our paycheck every month into separate, individual accounts. They serve as a sort of “allowance” to spend on personal things– like clothes or personal gadgets (e.g. a personal laptop, not the family desktop). This system works really well for us– for most aspects of our life, we’re pitching in towards the household finances together as a team, but we still have a little room to retain a bit of independence with our own spending money 🙂

young says:

Hmm sounds like a great idea- it’s a compromise between ‘all in’ and the divisive nature of the 50/50 split.

You always have great ideas, Helly!!

asithi says:

We handle our finances similar to this, especially now that we have a baby. You can’t exactly divide up the baby’s expenses 50/50.

I think how you handle finances as a couple has to do with understanding the other person’s background growing up. For example, my dad was really bad with money, so as a grown-up I cannot imagine giving up control of my finances even in a loving relationship. I need to have my own money. Whereas, my husband don’t want to think about money other than just the small amount in his personal account. So I handle all the money stuff in our family.

Cassie says:

I’ll be honest, this post was really refreshing. I was raised in the stereotypical nuclear family (mom, dad, one sibling) where my parents had one account that everything was paid out of. There was no his or hers, only ours. There seems to be a pride of sorts in the pf community that has to do with maintaining your own separate finances, paying 50% of everything, etc… that frankly I just don’t comprehend. It sounds like a roommate arrangement, not a relationship. It may work for others, but it really doesn’t make sense to me. It seems like sometimes people are so scared of what “the other person” might do with the money that the adjustment to working as a single family unit doesn’t happen. I think you hit it on the nose. Well put.

young says:

Thanks Cassie! Yeah, it didn’t occur to me until basically it hit me in the face and I realized I was being a selfish b*tch!

Fred Ziffel says:

You have described co-hab quite well. Kind of a partnership.

Marriage is all-in. To continue the metaphor, done right, it is more like a merger.

In which case, separate marital accounts is a recipe for a corporate spin-off.

young says:

@Fred- Marriage as a merger? Yes, great metaphor- marriage is a merger of families, of upbringings, of culture, of money!

I don’t know if I could still pool all the money in if I get married though- I still need to think about that one..