How to split household bills

When it comes to divvying up those household bills, there's no one-size-fits-all approach. We're talking about the nitty-gritty of who pays what, and let's be real – it can be as tricky as picking a movie on Netflix or worse, assembling Ikea furniture. So, let's break it down in a way that makes sense for everyone involved.

There’s a few ways to split bills, and after living with 5 girls in university I have tried most. What works will depend on who you live with, your relationship with them and how much involvement everyone wants to have.

Let’s dive in.

Keeping it simple: Equal division

Alright, this one's like splitting a pizza right down the middle. Equal division means sharing the financial load equally among everyone under the same roof. No need to fret about who earns what – everyone chips in the same amount. But here's the twist: while it sounds like the easiest route, take a minute to ponder if everyone's comfortable with this setup. We're talking about making sure it feels fair for everyone, no matter their earnings or how much they’re home.

For example, in university 3 out of 6 of us worked part time, so we were out of the house a lot. Another girl also went home most weekends and this was raised into the chat when we were working out our bills.

There was also a repeated conversation about how often the heating should go on, considering we were in the bitterly cold North East and I’m from the South, you can probably guess what side I was on – but that’s another story. Equality is great, but your circumstances may need to be very similar for this to work.

Paying as you earn: Based on salary

Imagine you and your housemates are running a relay race, and each person runs their part according to their speed. Well, with this method, you're divvying up the bills based on how much money each person brings home. It's all about maintaining that sweet balance between what you earn and what you owe. So, the more you make, the more you contribute. But remember, it's still got to feel doable for everyone on the track.

There are many angles to discuss this approach and these can get quite heated and sometimes even political. I see this working more if you’re very close friends rather than just housemates, or in a relationship. You’ll have to gauge how close you are to the person(s) you live with if you feel this is the route you want to go down and get their take on it.

Dedicated bills: Weighted distribution

An example of this would be doing a potluck dinner with your friends. Each of you brings your signature dish, and everyone gets a piece of the pie. Weighted distribution is a bit like that – it's about assigning specific bills to specific people. Maybe someone's the "Rent Queen," while another takes charge of keeping the lights on and the fridge stocked. This can work if you and your friends lean more towards the ‘we’re all in it together’ stance, as some bills may be more than others. You could even then rotate this and swap bills every quarter.

Choosing how you split your bills will take some communication to ensure everyone is on the same page. It’s important to make sure every voice in the household is heard when discussing this, so check on your quieter friends to make sure their opinion is included.

So now we’ve chosen how much everyone is contributing, let’s go into actioning this.

Collating money

The modern technology around today offers several apps and tools designed to facilitate bill splitting. Apps like Revolut, Splitwise, or Venmo allow you to track expenses, settle debts, and split bills seamlessly. They also generate clear records, reducing the chances of misunderstandings on who’s paid what. The only issue here is not everyone will be banking with the same apps, so in that case you could also go down the traditional route of dedicated bank account that’s used for paying bills. Setting up bank accounts is a hassle, so you could even nominate a bill payer and transfer money to their account, this could also alternate.

When I was in uni, the apps that are around today were not so intuitive, so we had to transfer all our money into one bank account and the bills were paid from there. Either that, or we transferred the money to the person that was paying the bill. Nowadays, there are many more options available.

Splitting bills step by step

Step 1: Crunch those numbers

Alright, grab your calculator (or just use your phone) – it's time to tally up what it takes to keep your household running. Add up rent/mortgage repayments, how much council tax you pay, utility bills like the water bill, broadband, food shop, and all those other shared monthly payments. This number is like the starting point of your bill-splitting adventure. Also, remember the one off payments such as the tv licence, maintenance costs or insurance. If your costs vary, I'd suggest setting allocating a number to each bill and monitoring it over the course of 3-6 months for an accurate estimation.

It's also worth mentioning you may need a separate pot for home repairs or parking permits, depending on if you're splitting them also.

Step 2: Pick your style

Now comes the fun part – choosing how you're gonna divide up those bills. Are you going for the "equal portions" method, the "earnings-based" approach, or maybe the "dedicated person" vibe? Make sure everyone's on board with the game plan.

Step 3: Put it to the test

Okay, so you've got your strategy in place. Time to put it into action! Stick with it for a few months, and then gather the crew for a chat, making sure everyone is still comfortable with the setup. Maybe someone's got a promotion, or perhaps they're pinching pennies or traveling for 3 months. Tweak your approach if needed, so you're all sailing smooth on the same financial ship.

Some other tips…

Get some ground rules in place

Okay you don’t need to have a written agreement on this, but it’s a good idea to put some dates in the calendar of when all money should be ready to pay some bills every month. There is nothing worse than waiting on that one person to pay a bill, so make sure everyone is clear from the start on when bills are due, how they will be divided and when they will be paid.

Be compassionate and flexible

Life is full of unexpected twists, and financial situations can change. Remember, the people you live with are also more than likely your friends or a partner, so flexibility and empathy are vital in maintaining a positive living environment. Be understanding if someone faces some difficulty in paying the bills, help them if you can and if you can’t you need to rethink your bill paying arrangement.

Remember, the key ingredient to successful bill splitting is like adding salt to your favourite dish – it's all about balance. Communicate openly, keep those numbers in check, and find the approach that's tasty for everyone's budget.

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