How To Split Bills Fairly When One Partner Earns More Than The Other

By Gerry Incollingo
9th Jan 2023

two people sitting at a cafe table taking a selfie

‘What’s mine is yours and what’s yours is mine’ – it’s a classic adage but when it comes to modern day dating but let's be honest, this is anything but true.

With many couples moving in way before a potential marriage or long-term commitment, money can be a hot topic. This is especially true when it comes to household bills. And when one partner makes significantly more than the other, it adds another layer of complexity.

Here are a few tips to help you manage your expenses when there is a big gap in income.

1.    Take Inventory Of Your Assets And Debt

One person may earn more on paper, but income doesn’t determine your financial position. You can have one partner making $70k a year with an investment property almost paid off and the other making $150k a year with a heap of debt. Though the partner may earn more per year, their expenses are also bloated by the debt they’ll need to service. This needs to come into consideration when deciding how to split the common bills. By tallying your assets and debts, you’ll be able to work out your individual expenses and how much you can contribute to the household after your individual expenses are paid.

2.    Create A Spreadsheet To Keep Organised

The more organised you can be, the less stress you’ll incur when it comes to paying bills. I recommend keeping a live document that outlines: the name of the expense, the cost of the expense, when it is paid, how it is paid. Once you’ve done that, you can discuss who pays the bill. There are many ways to split bills amongst couples – you can either have each person pay the bill in full e.g. one person pays for the Netflix subscription and the other pays for Amazon Prime. However, this only works when the bills are of similar value. If you have a laundry list of bills and find that there’s no easy way to split them, I recommend the following approach.

3.    Think And Divide Your Bills In Percentages

When the list of household bills seems endless, you can total the amount of household expenses and then agree on a percentage to pay. Let’s say that the total amount of household bills amounted to $1500. The person earning more could contribute 60% of the total while the other would contribute 40%. You can also apply the percentage approach when it comes to savings.
Money is always a tricky topic to discuss, especially with those closest to your heart. But full transparency and honesty will help you prevent friction and conflict later on.

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Gerry was appointed the managing director of LCI Partners in 1998, an established accounting firm based in Parramatta. Since that time, they have extended their locations to Sydney CBD and southern Sydney, employing in excess of 60 staff members across all offices. 

Image credit: Urban List

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