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How to Split Expenses Fairly When You Have Different Incomes


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When you're in a long-term relationship, financial disparities may exist regarding income, debt, and financial goals. Some couples split their expenses equally regardless of the income disparities between each partner. Some may choose to do a 70-30 split or some other method of compromising with the partner who has the lower income. Following is a strategy on how Tom and Sarah, a married couple, divided their income.


How to Split Expenses Fairly When You Have Different Incomes


Tom and Sarah were both thriving in their respective careers. However, Tom's salary was considerably higher than Sarah's. As they contemplated their future together, they realized they needed to devise an equitable system to distribute their finances because Sarah was barely making ends meet at the end of the month when accounting for her expenses. So, they sat down together to determine how they could split their expenses fairly.

After some discussion, they agreed to divide their expenses based on a percentage of their income. Tom would assume 60% of the expenses, while Sarah would contribute 40%. This arrangement would allow them to retain an equal proportion of their income for personal expenses.

They meticulously devised a budget to implement this system effectively and closely monitored their expenses. Tom and Sarah sat down together and wrote out their individual and joint expenses to determine what expenses could be shared and which should be taken care of individually. They accounted for all necessary expenses such as rent, groceries, utilities, and other expenses. They reviewed their budget annually and whenever they paid off a major purchase to ensure it was still working for them.


Initially, Sarah was apprehensive about the proposal, fearing Tom would have too much control over their finances. However, Tom told Sarah they were a team and would make all financial decisions together. They discussed their long-term goals and created strategies to accomplish them collectively.



Eventually, Sarah grew to appreciate the system they had formulated. She felt that they were making an equal contribution despite their income disparities. They were able to save up for their future goals like travel, purchasing new furniture, and paying down their mortgage while enjoying their present life without any financial burden.

Tom and Sarah showed that financial harmony could be achieved despite income disparities. Effective communication, trust, and compromise were key in managing their finances as a team, ensuring that both were on the same page and could achieve their aspirations together. Their story is a testament that financial success and happiness can be achieved with determination and mutual decisions.


Tips on how to divide finances when one spouse makes more than the other

  • Talk about your expectations. The first step is to discuss your financial goals and expectations with your spouse. What are your priorities? Do you want to save for retirement? Pay off debt? Buy a house? Once you have a shared understanding of your goals, you can start to talk about how to divide your finances to support them.

  • Consider splitting bills proportionally. One option is to split your bills proportionally according to your income. This means the person who makes more money will pay a larger percentage of the bills. For example, if one spouse makes $50,000 per year and the other makes $25,000 per year, the first spouse would pay 66% of the bills, and the second spouse would pay 33%.

  • Keep separate accounts. Another option is to keep separate bank accounts and then contribute a set amount to a joint account each month to cover shared expenses. This can be a good option if you want to maintain your financial independence and have more control over your own spending.

  • Get creative. There are no rules when it comes to dividing finances. You can get creative and come up with a system that works for you and your spouse. For example, you could agree to split all of your bills 50/50, but then the higher-earning spouse would contribute more to your joint savings account.

  • Be flexible. Your financial situation may change over time, so it's important to be flexible with your arrangements. If one spouse's income changes, you may need to adjust your spending or how you divide your finances.

The most important thing is to find a system that works for both of you and that you're both comfortable with. There is no one-size-fits-all solution, so take some time to talk to your spouse and figure out what's best for your family.


Setting Financial Goals as a Couple

  • Be transparent with each other about your finances. This means sharing your income, expenses, and financial goals.

  • Set financial goals together. This will help you stay on track and ensure you're both working towards the same things.

  • Communicate regularly about your finances. This is especially important if your financial situation changes. It creates a trusting relationship when you can share your income and expenses with your spouse.

  • Be respectful of each other's financial choices. Just because you have different incomes doesn't mean that you have to have the same spending habits.

Dividing finances when one spouse makes more than the other can be challenging, but it's important to remember that it's a team effort. By working together and communicating openly, you can find a system that works for both of you and helps you achieve your financial goals.


If you struggle with broaching the subject of finances with our partner, consider working with a financial coach or counselor to find out how you can get unstuck.


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