Setting up a new home together, how do you sort finances?

[nevermarryamitford]

Curious as to how people set up their financial arrangements when moving in with new partner. We will be renting a place together, he has an XW and DD and I have never been married.

What is general consensus? Do most people set up a joint account and pay out rent and utilities from that with both people paying in equal amounts and paying half of everything?

Help/thoughts greatly appreciated.

Hi this is what we do, which seems to be quite a common arrangement. When me and DP moved in together we kept our individual bank accounts but set up a joint account for all bills, food, savings, holidays, household expenses etc. We each had our wages paid into the joint account minus an amount each for personal spends and petrol. We each get exactly the same. £250 per month "fun" money and £100 for petrol. If we want to buy anything extra we get this out of the savings pot, but will discuss any purchases over £50 first. This has always seemed to work OK. You need one person to keep an eye on it in our case it's me, I will monitor and if funds are getting low etc.

We set up a joint account for all the bills etc. We then both pay the same percentage into the account and this covers mortgage, bills, food, non work fuel, holidays, house spends, meals out etc. The remainder is ours to do what we want with. Currently, 65% of our take home goes into the joint account. We have overpaid our mortgage throughout and will be mortgage free in 2 years, taking a 25 yr term down to 12. Which has saved us loads in interest.

We have a joint account and our own personal accounts, we pay a percentage in each month of our earnings, so the lower earner isn't penalised and make sure the amount in total covers all joint expenditure and also some extras, like meals out, cinema etc. What's left we use on personal spends.

This was my decision, my husband wanted to go all in, but I like my financial independence and he is the sort to ask why I had to spend 50 quid on a bottle of foundation. I earn it, my call how and if I spend it.

We did it without setting up a joint account - just each took responsibility for a roughly equivalent amount of monthly bills/expenses so one did e.g. rent, petrol, water and the other did council tax, broadband, energy, food. Or something like that! We'd check in every 3 months or so to make sure nether of us was out of pocket. We'd started it that way as our first rental house together was arranged through one of our employers, so the rent was deducted from monthly paycheck and couldn't be paid out of a joint account. Then it just seemed easier to carry on in our next house as it was working well for us. Plus we started to think about buying a house, and by that point didn't want to open any new accounts or do anything which might complicate our credit histories in the run up to a mortgage application.

We keep our money separate. All bills go from my account and DH gives me his share every month as a lump sum. The lump sum changes to balance any changes in our pay packet.

Any extras that crop up we manage between us.

This has worked for us for 14 years and through two stretches of maternity leave. Joint accounts aren't for everyone. They certainly aren't for us.

I have twice had a long term, living together relationship, both times we arranged it the same way.

Start by putting together a budget of what will need needed to run the household, rent/mortgage, utility bills, food, etc. Doing this, means that you agree what will be covered, and what, if anything, not, may be phones, cars etc, whatever works for you both. Set up a joint account, consider whether it needs overdraft facilities.

Now you know what household money you will need, agree how to split this. If you both early roughly the same, 50:50 seems reasonable. When we have very different incomes, we paid into the household account in proportion to our wages. Everything else is our own to save or spend as we see fit.

If/when things changed (new job, pay rise) we adjusted the percentages. Nowadays, when we are old gimmers and money is less tight, the household has been known to take us out for meals, on holiday etc. It gets fed extra in anticipation of Christmas.

This works for me, can't imagine doing any other way. I keep an eye on my own account, and automatically rein in if I notice that it is getting low. I wouldn't feel happy having to rein in my spending because someone else had spent more than usual.

@cowardlycustard2 thanks so much for your reply, this is really helpful. It seems like you and your partner have a really healthy and cohesive attitude towards your finances, and that's so great.

@AlternativeTentacle This is so useful, thanks so much. And WELL DONE on paying off your mortgage early! This is so inspiring to me and such a fantastic thing to have achieved.

@Bluntness100 thanks so much for your thoughts, I'm really interested in the idea of paying in a percentage of wages, this feels like a really fair approach. Also amen to £50 on a foundation and not having to explain it to anyone!! Men never get that stuff...

@TonicandTonic thanks so much for your response, its really nice to hear a different way of doing it that is equally as successful, just shows its down to the individual couple.

@CadnoDrwg So interesting to hear another differing point of view that obviously works really well for your situation, thank you for your comment.

Pretty similar to most here by the sound of it. We get paid about the same so we each put £X into the joint account on payday and rent, utilities, council tax, broadband, food and dog related expenses come out of there. Anything left over is kept in the joint account because the interest rate is high for a current account, so it also functions as our savings account. We deliberately overpay into it to maximise the interest.

@FinallyHere absolutely love your post thank you so much for taking the time to tell me how you've made it work. You've given me a great insight into how I can structure our finances as well as pointing out considering we need overdraft facilities (hadn't even occurred to me)!

I like how your system seems to be reviewed regularly and is flexible, I think this is something we will need to do as we are both small business owners and our incomes fluctuate. I just need figure out what % feel appropriate and make sure we cover what we need.

Really appreciate your thoughts, thanks so much!

@ButFirstTea thanks so much for your thoughts, really interesting to her how everyone sorts their combined finances out.

I lost all my tax credits and child benefit when I moved in with DH, so he agreed to support me and DD to cover losing all of that and he transfers a sum into my account so we end up with roughly equal spending money. He has always earned much more than me, so it's worked out easiest for him to cover the full mortgage and bills, while I pay for a few expenses here and there. We don't do joint accounts but we view money as shared, we don't owe each other money or try to split things. We don't ask each other before buying anything, I'd find it irritating to have to justify my spending choices.

@heromashers You sound like you have a really lovely, balanced partnership, thanks for your thoughts.

I would be very grateful if anyone else would consider sharing their strategies...

We both put all our wages into a joint account and bills come from there, the rest is spent as needed (we both have bank cards etc). We discuss purchases over £200 with each other prior or soon afterward making them.

Savings are half in his name and half in mine, but we both know we own all the savings together.

When we got together we agreed to be a family and this is how we felt we should sort finances.

DH is interested in investing in financial things but he runs decisions by me first.

Good luck for your new relationship, I hope you have many happy years together

WrittenandGrown Thanks so much for telling me about how your system works, it sounds like you have a lovely, equal partnership.

Thank you so much for your kind wishes, much appreciated : )

we bought a house jointly (and are now getting married, plus no previous spouses or kids on either side so may be different considerations) so we have a joint account which mortgage and household bills money goes into.

We keep our own separate accounts for the rest and have a credit card which, though in my name, has him as an additional card holder. All joint spending (food, hols, dinners out etc) goes onto that (as we get points with it) and I keep a tally as sometimes, each of us put personal spends on there too. End of month OH pays over to me what he owes for his share of credit card and I pay it off in full.

For big things like household maintenance, repairs etc, we just split those down the middle.

I contributed more to buying the house as we were able to sell my house in my sole name but OH's flat wouldn't sell in time. So we made joint decision that it was best to keep OH flat and rent it out for the moment. If/when he sells it, he will either pay me back what he owes (to reflect fact I put more into the pot) or he will pay for extension to this place if we need it.

Seems to work for us but maybe trial what you are thinking and see if that works, if not, try something else

I think that a lot depends on where your relationship is at - sounds like yours might be relatively new.

I'd probably give it a year of living together before committing to a shared account. It should give you enough time to get to know each other better and understand your attitudes to money.

When we first moved in together, we were quite informal about it all but somehow got on well.

When we had lived together for about a year and our relationship was progressing nicely, we decided to get a joint account. It has been working similarly to CowardlyCustard's set up: the same 'pocket money' and a shared account for everything else. Any more expensive items, e.g. furniture, cars, pension contributions etc we decide together. It seems to work really well but we're both pretty sensible too.

CoastalChick So interesting to hear you you've set yourselves up, and you're right; a trial system is a great idea to figure out what works for us.

JoJoM2 Such a good idea to give it a year and see how it goes. Really glad you system works so well for you.