Expenses happen, they are a part of life.

But when you are managing your own expenses life is super easy. You’re the only one around to pay it, so if a bill comes up you have to pay it. But when you are a couple, covering bills is more complicated.

Do we dump all the money in one pot? Should we split it 50/50? What’s ‘fair’ for each of us to pay? Not having this conversation can spell disaster for your budget and your relationship.

So if you aren’t sure how to divide the expenses, then here are the common methods that will give you some ideas on what to do. So you can make the decision with your partner.

The “You Pick Your Bill” Approach

In this approach, each spouse picks the bills they want to pay for.

Who Likes It: Couples who want to keep their finances separate but still want to have an equitable balance of the couple’s expenses.

How it works: The easiest way to deciding which bills a partner should cover is to base it on whose name the bill is in, or which bill matters the most to the person. For example, my hubby has strong opinions about our cell phone provider and is willing to pay more for a little better service. I, on the other hand, don’t care much, either way.  So his paycheck handles the cell phone bill as well the internet and grocery bills. While the funds related to the mainstay of the home – mortgage, electricity and water – all come from my paycheck because I picked those bills.

Thing’s to think about: Just know that when you pick your bill, sometimes the bill payments do not divide up equally, and you have to be willing to accept that.

The “Divvy By What You Can Afford” approach

This approach allows for each spouse to contribute a percentage of their salary towards the bill based on their income.

Who Likes It: Couples who have large differences in income where the joint expenses might be more than one can bear and a 50/50 split would create hardship for one partner. For example, you move into your spouse’s home where the mortgage and auxiliary expenses are higher than you can afford.

How it works: Each spouse contributes a percentage of their pay to a joint account base on their income. So for example, let’s say Dan makes $2000 a month, while Sue makes $6000 a month and their monthly expenses are $2000. If both partners paid 50% of the bill, then Sue would put $1000 which would only be 17% of her salary towards the bill, but when Dan paid $1000, he would be paying 50% of his salary towards the bill. That’s a little hard for Dan especially if he has his own ‘personal’ bills to pay. Instead, with the pay as you can afford approach, since Sue makes 3 times Dan’s salary then Dan would pay a 1/4 of the bill ( i.e. $500) and Sue would pay 3/4 of the bill (i.e. $1500) of the bills. 

Things to think about: Even though this approach is meant to be an equitable division of the couple’s expenses, it doesn’t factor in individual expenses. For example, if Dan is also paying his mother’s mortgage at $800 per month and a $200 student loan debt, then he would only have $1000 available income. Paying $667 out in joint expenses would leave much of Dan’s paycheck for anything else.  won’t be the same as on his paystub. 

The “Let’s Go Dutch” approach

In this approach, the bills are divided 50/50

Who Likes It: Couples that believe in each partner paying their own way evenly. Also, couples who are in the same financial status in terms of income and debts, etc.

How it works: Set up a joint account, divide the bills in half and each person agrees to deposit the agreed upon dollar amount in the account every month. 

Things to think about:  This can become incredibly stressful if entered in with significant differences in income. It isn’t good for your marriage if you are rolling in the dough, meanwhile, your spouse can’t go one month without using credit cards because their expense half if so high. They are your spouse, and you want them to be happy, sometimes we all have to work together to get the boat to the shore.

The “I’ve Got You Covered” approach

One person covers all the bills for the household

Who Likes It: Couples where one person doesn’t work, is in school or one person makes significantly more than the other.

How it works: The higher earner pays the bills from their account. Or a joint account can be created and all the bills are paid from that account to ensure both partners access to the funds and are a part of the financial decisions.

Things to think about: Your attitude is key in this approach to paying expenses. If you know you can’t do it with grace and show respect to your spouse regardless of the financial setup, then keep moving and don’t do this to yourself, your spouse or your marriage.

The “We’re all in this together” approach

All bills are ponied up together and are paid for from a pool of the couple’s income

Who Likes It: Couples who are focused on building finances together and see want to handle everything as one unit.

How it works: All income from both parties are put in a joint bank account and all bills are paid from that account.

Things to think about: This is another approach where your attitude is everything. If the thought of allowing your spouse full access to your entire paycheck makes you scared, even a little, then this is not for you. You must be able to trust your spouse completely because as joint account holders they have legal access to the account with or without your permission.

“Living On One” approach

This approach has one income being saved and the other being used for expenses.

Who Likes It: Couples that are focusing on saving for an upcoming goal – buying a house, having a baby, practicing for additional daycare payments etc.

How it works: The person with one income covers all the expenses, much like ‘I’ve got you covered’ approach, and the other person’s income is placed in a savings account.

Things to think about: If you are trying the life on one approach in preparation for one spouse to exit the job market, then be serious and will to peer down your double income expenses. If you find yourself dipping into the savings income from your spouse then you are not ready and must be willing to abandon the adventure if necessary. Otherwise, you will set yourself up for getting into debt.

Let’s Talk About Bills Baby

Whether you are in the camp of merging all your finances, keeping things separate or doing some hybrid of the in-between, you’ll want to decide on how you are going to handle your everyday expenses to complement the strategy you choose.

As always in these discussions, there are no wrong or right ways to do it. There is no one way to do it either. Some approaches are good for certain types of bills and sometimes a hybrid of a few approaches is better.

You are still free to do as you choose and decide what works for you and for how long. 

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