Post # 1
My FI bought a house a couple of years ago. I am moving in with him after the wedding. Onky his name is on the mortgage and the house is not a joint asset because it was bought before the wedding. I’ve been wondering about the best way to split expenses in such a way that is fair to both parts. His salary is twice than mine. Bees with similar situations, how do you split? Thanks!
Post # 3
@mspanda13: I saw something about this on Suze Orman (dont laugh, she’s great! lol) Anyway, now that I recall, it was about a couple that just got married and he had a son and they were figuring out her contribution to the expenses. Anyway, it was essentially 50-50….BUT because of the differences in salaries, it should be 50% of your salary and 50% of his.
Post # 4
True half-n-half (you pay 50% and I pay 50%) doesn’t really work… as in most cases there is always someone who makes more money.
Nor do percentages… example, I make 2x as much as you, so I contribute 2/3 and you 1/3
The best solution for the long term, seems to be to Pool ALL THE MONEY that comes into the house.
Pay out all the Bills & Expenses, and then alot equal amounts to savings. Be they your own Retirement Savings Accounts, AND / OR an Account that you use for joint savings for larger down the road expenses… House Purchase, House Renovations, Car, Boat, Vacations etc.
Whatever is then left, is again equally divided between the two of you as discretionary income (fun money) to be spent as you each see fit.
In this way, no one person has more say / control over the money than the other (a major factor in divorces when it comes to money issues)… and if God-forbid down the road later, you should split up, then you’ll both have the same amount of money in our retirement accounts / savings… which makes dividing assets that much easier.
Hope this helps,
Post # 5
We pool all the money and it took a couple of months to get a hang of the $ thing and figure out bills. Does he have a problem with puting your name on the deed? Me and DH are joint everything, we are legally responsible for all credit cards as well.
Post # 6
@mspanda13: i would say 50/50. but to be honest, if i was paying for half the mortgage, i would want my name on the title, otherwise, it would be considered rent to pay off his mortgage. you may want to discuss putting your name on both the mortgage and the house title. then you will be responsible for half the mortgage but also own half the house.
Post # 7
@This Time Round: +1 This is what FI and I have talked about doing once we are married. I make about twice as much as him and am waaayyy better with bills than he is. I think it would be much less of a stressor on us both if we just pooled the money together and alotted each one of us “allowances.”
I also agree with the other pp’s about adding yourself onto his mortgage lean/deed. I just talked with my mortgage company and they said that once we are legally married, I can add him to my deed without a problem. Have you talked to your FI about that?
Post # 8
I personally would never pool all of our money together. I think joint accounts are in order and putting the same percentage of your salaries in there, for joint bills and savings.
Also making a plan, becuase if he had the house for a couple of years he probably put a lot of money into it. So you guys need to decide if you sell it and buy another place how you will do it. And if you keep it when you can become a co owner.
Post # 9
@TwoCityBride: Yes, that’s the thing, he has already put a lot of money on the house, and do definitely cant’t payhour half of that, so I think that to put myself on the deed is pretty unfair for him. We have been thinking about him paying the mortgage and me paying for utilities (TV, Internet, house maintenance), anybody else doing that?
Post # 10
@mspanda13: I’d treat the house separately and then split the utilities.
Ordinarily I am salary split kinda girl, SO earn twice as much as I do so he pays more of the bills. BUT, since you FI is paying the mortgage alone anyway, a large chunk of money each month, it seems fairer to split utilities 50/50 (after all you both use the same amount of heating/water/tv etc).
Or you could create a joint bills fund as PPs have said. We’re unsure if we’ll be doing this but if so we wont be doing it until after we’re married.
Post # 11
It really depends on your relationship. I’m a fan of pooling everything. It is not my money/his money it is all our money, regardless of the account (some accounts can’t be made joint, and for tax purposes it makes sense for me to have the non-registered accounts in my name).
Post # 12
@mspanda13: I too moved into my FI’s house. I sold my own house so that life could be slimpler. He also makes twice what I do. 2.5x to be exact.
FI and I talked about this in the event that I help pay the mortgage and we split up. We came up with some complex plan for paying me back plus what equity would have earned from the date I moved in to the date we split up. IT was all very complicated and in the end we did not do anything like that, we pooled it all.
Pooling it all made sense for us. If we did not pool, I’d go for the proportion rule. If you make 30 percet of the total income, then you pay 30% of the shared bills – yes that would include the house. That way it is proportional to your income.
“so I think that to put myself on the deed is pretty unfair for him”I HIGHLY suggest that you get on the title of the house. Why? Because if something happens to your husband, then you are the next owner of the home. You don’t want to be without a roof over your head should something happen to him. I don’t think it’s being unfair at all, even if he’s put $$ into the house prior to you. It’s called protecting his wife in the event that something happens to him.
Does that make sense?
Post # 13
- Wedding: July 2012 - Baltimore Museum of Industry
Suze Orman’s % of salary is what we’re planning to do- it doesn’t make sense for one party to potentially get “wiped out” when the other has tons of play money- she writes about this in several books (I know Courage to be Rich has it.)
Depending on how you feel about a pre-nup, that’s one way to put you on the deed and protect his initial investment. Or make sure he gets a will- once I change my name, we’re both getting ones.
Post # 14
@mspanda13: I had (have) the exact same situation you have, and we pool all our money. I would only recommend that if you have similar spending habits and agree on things like how to handle personal spending money. So far it works great for us. We’re in this for the long haul, so there’s no reason for it to be “his” money or “my” money.
Post # 15
we already figured this one out. I make almost twice what he does, so we are going to have a joint checking and pay all of our bills out of it, give ourselves about thirty each a week for eating on, and whatever is left we will put towards savings or do something fun with it.
Post # 16
When my fiance moved in (I bought the house years ago but there is still a mortgage) I worked up a spreadsheet of how much it costs to keep the house up and running, including mortgage and insurance. We then pro-rated shares based on our salaries (he made a little more at the time, so he contributed a little more). Our expenses included his car note and insurance, btw, as that is our only car. While he owns the asset, I use it as much as he does, so I share towards its upkeep, just like the house.
As to whose name goes on the deed, I am NOT having him added to the deed and he’s fine with this. While I am absolutely in this relationship for the long haul, I do know the cold hard facts about divorce rates, and while I love my fiance very much, I already know he’s not getting half the house if we split up. This arrangement won’t work for every couple so you need to discuss and do what feels right to you. It just makes sense for us to contribute to the mortgage more or less equally because he would need to pay to put a roof over his own head no matter where we lived or even if we lived apart.