Would anyone mind suggesting ways to split finances?

[AnduinsGirl]

Hi all,
My boyfriend of 8 months and I have been in a long distance relationship, alternating travelling to each other every three weeks or so. We're spending a bloody fortune on transport/hotels and it's just awful when we have to say goodbye. After an amazing week of him being up here, we have decided to move in together, with him moving into my house. I'm so excited for this, but haven't a clue how to split finances as I've never lived with someone before. I'm also going to be the higher wage earner by far, and would appreciate any suggestions of how to be fair, so we both have money to enjoy, but keep myself protected. For the record, he's incredibly open to discussing finances and has stressed he has decent savings and would hate to "sponge" off me.
This is the situation:

• No children on either side, and no plans to have any.
• I take home £3k/month, he will have to find work but realistically to begin with I think this will be lower - he currently earns £1100/month.
• I have debts which I pay off regularly which of course are my responsibility and would expect to keep paying them alone. He has no debt.
• Currently after all bills, mortgage, debts, car payments, etc are paid, i have a disposable income of approx £1k/month. This is obviously a really decent amount. I'm very embarrassed that I don't have savings - I do not spend sensibly at the moment, which I want to address ASAP.
• We want to live fairly modestly and start a savings account. Would it be wise to wait before doing this and ensure we are compatible living together?

I feel like we will have a really decent amount coming in every month, and appreciate we're really lucky. I know we need to sit down and work it out in finer detail, but any comments or suggestions would be really helpful - thanks!

I would suggest that initially you receive a set amount from him in rent (covering all household bills) and split food. If all goes well open a joint account for bills, food etc and a joint savings account but see how compatible you are first. If he's on a low wage then ask for around 40% perhaps to cover rent? But it's up to you.

I would not suggest joint accounts for around a year, treat it more like a lodger situation financially.

At that stage of the relationship, split rent and bills 50:50, joint account for household expenses like food, cleaning stuff etc, both pay in equal amounts.

Separate savings. Only merge when you are properly committed. 8 months in long distance with one lovely week together is too soon for anything else.

That's helpful thank you, stucknoue! Mortgage + all bills + food = £1k I think, so that's a useful starting point when working out what to ask him for. Just realised as well that I've just finished paying off an old debt so that's an extra £250 freed up a month. I know debts are priority but I'd like to save some money to do the house up.

Should have said, pay off your debt before starting savings.

Thanks Purple You're right, it's still very early days so am happy to approach it in this way rather than merging too quickly.

Use the £250 freed up to start overpaying on the debt with highest interest. It will save you money in the long run.

Use the £250 freed up to start overpaying on the debt with highest interest. It will save you money in the long run.
Thank you - this makes sense - I have a credit card I want rid of so will re-direct the funds there.

Use as much of that £1k disposable income as possible to get rid of the debts.

Is that £1k between you or each? X

The 1k is just my disposable income - but I've now realised it's closer to £1250

Don’t move in with someone you’ve only known 8 months. However nice your weeks holiday was.

Don’t move in with someone you’ve only known 8 months. However nice your weeks holiday was.
I do appreciate it's not long, but we're both happy to give it a go. We're very calm, easy going, drama-hating people and if it didn't work, we'd accept that. He'd have somewhere to return to and I'd still have my house. For the record, we haven't just spent a week together and decided "this is nice" - we've spent a lot more time together than that due to the flexibility of our jobs.

As you are comfortable with your outgoings currently, I personally would do the following:

Month 1 - ask for £100 for the months food but say this is in recognition of moving costs and loss of income.

Month 2 onwards - (assuming job sorted) ask for £100/£125 a week as this should cover most of the food and a minimal amount towards additional water/electricity. Pretty much lodger style rent or rent a room (limit of £144 a week for this year).

I’d also try to get rid of my debt as quickly as possible, advise he waits until he’s applied for some jobs near you and has some interviews to attend. I’d also put his rent straight into a separate savings account to be used towards a future house deposit. I’d hesitate to join finances too quickly but after a year of living together I’d consider joint account for bills.

Good luck to you both

MrsGrannyWeatherwax Thank you - this is really helpful. Love the idea of using his rent for something specific, rather than it just be swallowed up in silly purchases.

I know people say split bills 50:50, but I’ve always been the higher earner and found what was fairer for us has been to both contribute the same % of our net salaries to a joint pot for the shared expenses. That way both of you are left with the same proportion of your net income to use as you like. If eg joint bills are £1000 and boyf’s take-home is £1000 and yours is £3000, I don’t see how it is fair for him to have £500 left to spend whilst you have £2500 (tho I appreciate you’ve earned it!). Imo in this example you would both contribute 25% of your net earnings, so for him £250 and you £750. He’s left with £750 and you have £2,250 (just using made up numbers here). I think this is a better split tho I do appreciate you’re carrying him by doing this. And perhaps 50:50 is better to start with until you’ve sussed lay of land - you’re going to have to ensure your higher standard of living doesn’t max him out though. (Reading between lines when you say you’ve haven’t been able to save.)

When I did 50:50 on bills with my boyfriend, he would just run out of money by end of month and then would have to “owe” me if we went out and I paid for all of it.
Contributing the same proportion of our income has made things far easier for us.

It’s too easy to loose money like that (shoes for me) but as you’ve got a lot of disposable income anyway it’s better to put it straight into savings as you don’t miss what you’ve never had. But you definitely don’t want to tell him that’s what your doing as he may feel like he doesn’t need to pay it, and supporting him this early in a relationship isn’t a great idea.

If eg joint bills are £1000 and boyf’s take-home is £1000 and yours is £3000, I don’t see how it is fair for him to have £500 left to spend whilst you have £2500 Yes! This is how I feel! And you're quite right with your assumption about my lack of savings. This is what I want to change though - I shop SO inefficiently and have very little to show for my stupid spending. He's got his head screwed on a lot better than me.

I know people say split bills 50:50, but I’ve always been the higher earner and found what was fairer for us has been to both contribute the same % of our net salaries to a joint pot for the shared expenses.
Normally I’d say to do what you suggest, but they’ve been together for so little time that it seems a massive risk. I’d move to the %split when they’re properly committed.

I'd only have him pay half towards bills and food. Pay the whole mortgage yourself for a while to see how it goes. You don't want him gaining a claim on your house if it goes pear shaped.

Split bills in half regardless of earnings as he'd still have to pay bills equally in a shared house.
I don't do the whole I earn more so pay more. Its penalising that person then.

I think the % of earnings is the fairer way, maybe 35/40% each in a joint pot and all expenses paid out of that, then anything left is savings/holiday fund.

If he is paying toward the mortgage though can he make a claim against it of things don't work out? Maybe get some proper advise on that.

If eg joint bills are £1000 and boyf’s take-home is £1000 and yours is £3000, I don’t see how it is fair for him to have £500 left to spend whilst you have £2500

She's only known him 8 months! They need to keep their money separate for a lot longer.

OP, why is he only earning £1k approx per month? Is there any chance of him earning more?

I think it's far too soon to do it by % of earnings. It's such a new relationship.

Why not charge him £600 for everything and use that to pay off your debts? He has £500 free per month then. You can also throw another £600 from your own money at your debt and it'll soon reduce.

OP, why is he only earning £1k approx per month?

That’s pretty much a full time minimum wage job...

On so many posts everyone seems to suggest when it’s the man earning more he should contribute more, so I feel as you do (you should contribute more). If you are moving in together once you have calculated the outgoings for rent/utilities/etc set up a household account with each contributing a percentage. All other money in your own individual accounts for personal expenses (or savings).