When deciding to shack up with someone and split expenses, you will hear all manner of advice on how to proceed. “Throw all in,” your Depression-raised grandpa will tell you, implying that 100 percent financial merging is the only way to really commit to someone. “Keep it all separate!” your third cousin from Montreal will declare, indicating that the best possible course is total financial autonomy from your paramour. “Go 50/50!” a nearby barista will interject, because it’s the only truly equal option there is. Well take it from me, a random woman you’ve never met, when I tell you that contributing to your household expenses via proportional sharing, or percentages, is the best way to live.
But before we explain what that is and why it’s the best, a few points: Money makes us all a little crazy, it’s just a question of how — some people use it to buy love, security, freedom or status; others use it to control or exploit others. Many of us learn how to manage money in a trial-by-fire sort of way, and it’s one of the last things we talk about in a real, substantive way with our partners. And by then, it’s too late. The first time you argue about money you realize you’re working from deeply ingrained attitudes you may have never even examined, much less articulated. You could be dating someone for years before realizing they think credit cards bills evaporate if you don’t think about them, or without finding out what they make.
Weirder still, you can think you’re one way about money only to realize it actually depends who you’re with. For instance, I was the penny-pincher with one boyfriend — always budgeting, planning, saving, paying down debt, minding my credit score and pestering him to watch the expenses. Then, a little older and wiser in the next relationship (and with a bigger salary), I suddenly wanted to enjoy what I’d never been able to in my 20s. I would indulge myself with a fancy coffee or pricier salad every now and then, feeling that I’d earned it. Only this new boyfriend never bought himself coffees or salads and though it was excessive, so suddenly I was the irresponsible one who needed to be reined in, even though I had always seen myself as the defender of common sense and frugality.
If you read articles about how couples should split bills, they all pretty much go the same way: Here are several methods you could try, all with pros and cons, but in the end, remember, whatever works for you is what you should do. This is a nice idea and all, but it’s disingenuous. If doing whatever works actually worked, money would not be one of the top reasons people fight and/or break up. (For better insight, just read about how actual couples do actual money, and look at how fraught and complicated and convoluted and emotional it is. And look at all the work couples do to make this go smoothly. Look at how disagreeing about money looks when you’re not being crazy.)
The real issue of course is that many people don’t know what works. All people know is what they learned about money growing up: that talking about money is bad, and that disagreeing about money should make us extremely upset, stubborn, self-righteous and/or angry, and that this little passion play with a partner should repeat forever or until divorce, whichever comes first. (Hint: It’s divorce.)
Which leads me to proportional sharing. I have tried all the other ways sharing finances can go: I have been the freeloader and freeloadee. I have split the bills 50/50 even when I made less; even when they made less. I have kept stringently separate checking accounts; I have had only shared joint checking and savings.
In all of these cases, someone was getting stiffed. You can act all day long like you don’t mind supporting someone, but you do. You can act all day long like you don’t mind being completely subsidized by someone else, but you do. You can act all day long like you don’t mind going halvesies even though she makes $50k more than you do, but you do. And so on. You can pretend to throw everything together in a blind pot and pay everything out of it, but if the one who makes less spends more, and believe me, they always do, you’ll care.
So after having done all the things, I can see why proportional sharing is the most logical and fair of all. It gives you the best chance to enjoy what you earn, to share expenses with another person in a fair way, but to create clear divisions around your own financial independence.
Here’s how it works: You figure out what your total household income is and what percentage of your income that is, and that’s what you pay in household bills. Here’s a breakdown from the finance site Money Musings, drawing from the example financial guru Suze Orman advised a decade ago:
Here’s the fictional household setup that Suze presented as an example:
Partner #1 makes $7k/month.
Partner #2 makes $3k/month.
Household expenses total $3k/month.
In the case above, Suze would suggest that the bills be split 70/30, rather than 50/50. This way, each partner/spouse is responsible for an equal percentage of the bills rather than an equal dollar amount. They don’t earn equal dollar amounts, so they shouldn’t pay equal dollar amounts.
In other words, the person making $10k a month earns 70 percent of the total household income and should therefore pay 70 percent of the bills. That’s about $2,100 a month, leaving the person who makes just $3k a month to cover the remaining 30 percent of the bills, or $900. The person making 10k still has a boatload of dough left over — like $8k a month. The person making $3k is not left destitute, either, with over $2k a month to do as he or she likes. There are all sorts of variations on this approach, and Orman also recommends that you set up a proportional savings account for the two of you, as well as separate ones to protect yourselves completely should the relationship not work out. Other couples use the leftovers to stockpile shared savings.
But the reasoning is the same: Merge some money, and keep some so you can survive without the other person. Two people can’t make a go of it when one person is killing themselves to make ends meet and the other person is living large. Nor should a successful person have to foot the entire bill and let the lower earner use their entire salary as play money — a setup I hear of with astonishing frequency that nearly always produces intense resentment, usually on both parts.
Proportional sharing just means that you’ve agreed to support each other fairly and spread the load; not forcing one person to hold the other person up. I concede that this doesn’t sound terribly romantic, but consider the alternative: The relationship doesn’t work out, but when you look back, all you can wonder is where all your money went.