Two people who share a home share its bills, and there are two ways to split them. Down the middle, which is what everyone starts with, and in proportion to what each one earns, which almost nobody can explain. Both are defensible. What changes between them is not the cost of the house, it is what each person has left at the end of the month, and that is why the choice matters more than it looks.
Down the middle is simple and treats the two people equally. Proportional takes a bit more work and treats them fairly. When the incomes are similar, equal and fair come to much the same thing and the argument never happens. When they are different, they are different things, and it is worth understanding the difference before the household decides by habit.
Why does 50/50 look fair and sometimes isn't?
Because it treats the cost as if it were the same thing for both people, and it is not.
A hundred euros of rent is a hundred euros whoever pays it. What is not equal is what those hundred euros stop being: for the higher earner they are a small slice of the month; for the lower earner they can be the difference between making it to the end of the month and not. The bill is the same. The weight is not.
A 50/50 split divides the cost. What it does not divide, and this is the part you feel, is the breathing room.
How do you split in proportion to what each earns?
Add the two incomes, work out what percentage of the total each person is, and have each pay that percentage of the shared costs. Three steps, and the third one is a multiplication.
So the example does not depend on real salaries, I will put the two incomes together at 100. Say one earns 60 and the other 40, and the whole house, rent, electricity, water, internet and groceries, costs 50.
| Both earning 100, the house costing 50 | Down the middle | Proportional |
|---|---|---|
| Paid by the one earning 60 | 25 | 30 |
| Paid by the one earning 40 | 25 | 20 |
| Left to the one earning 40 | 15 | 20 |
The bottom line is the only one that matters. Down the middle, the person earning 40 is left with 15 for the whole of the rest of their life, transport, clothes, health, going out, saving. Proportional, they are left with 20. That is a third more, and the other person went from 35 to 30, which is a difference you notice a great deal less when you start from 60.
Notice what happened: in proportion, both are left with exactly the same percentage of what they earn, 50%. That is what the rule does, and it is the whole argument for it. It is not charity from the higher earner. It is sharing the effort instead of sharing the invoice.
What about debts and commitments only one person has?
They stay out of the income calculation, and there is a good reason.
The temptation is to subtract one person's car loan before working out the percentages, so that their "real" income shows up. The problem is that this opens a door that never closes: next it is the gym, then helping out a parent, and in the end the two of them are arguing about which of each other's costs are legitimate, which is exactly the conversation the rule existed to avoid.
The rule that holds is simpler: the proportion is worked out on what comes in, before anyone's choices. What each person does with their share is their own business. If one has a large debt, that gets solved by talking about the debt, not by bending the percentage on the rent.
The honest exception is a cost that exists because of the house: if one of them took out a loan to put in a new kitchen, that belongs to the house, not to them.
What goes into the split and what stays out?
Whatever both people consume without being able to tell who consumed it.
In goes the rent or the mortgage, electricity, water, gas, internet, building charges, home insurance, groceries and cleaning supplies. Out goes clothing, each person's phone, the gym, lunches out and the presents each one gives.
There are two grey areas worth deciding once, rather than deciding every month:
- The car, when there is one and it serves both. It goes in, if it serves both. If it only takes one person to work, it is theirs.
- Going out together. Dinner out is not a household cost, but it is also not fair that the lower earner always pays half of a restaurant they would not have chosen. Either it goes into the rule, or you agree that whoever invites pays. Both work. What does not work is never having decided.
Who pays what, in practice?
There are two setups that work, and the worst of all is having no setup.
Each person pays whole bills. One takes the rent, the other takes electricity, water and internet, and you adjust until the totals match the percentages. Fewer transfers, less noise on the statement, and it works when the bills happen to divide up that way.
One shared account for what belongs to the house. Each person transfers their percentage on payday, and every household direct debit comes out of there. It is more transparent, because everything that belongs to the house sits in one place, and it settles "who pays which direct debit" for good.
The second takes more work to set up and less to keep running. The first is the other way round. Choose the one you can live with for six months without anyone having to remember anything.
How often do you revisit the percentage?
When one of the incomes really changes, and not month by month.
A percentage recalculated every month turns a rule into a permanent negotiation, and a permanent negotiation wears people down more than the unfairness it was correcting. Fix the numbers and leave them alone. When someone changes job, gets a raise that counts, goes freelance or loses work, redo the sum then.
If one income varies every month by nature, commission, tips, freelance work, use the average of the last six months rather than this month's figure. A good month should not buy a worse percentage for the month after.
And how do you avoid counting the same cost twice?
By writing each cost down once, in the place where it is paid.
This is the mistake that ruins shared accounts most often, and it has nothing to do with honesty. One buys the groceries on their card and says so. The other, tidying up the numbers at the weekend, sees the same purchase on the joint statement and records it again. By the end of the month the house appears to have eaten twice, and nobody can work out why.
The rule is short: a cost has one owner and one place. If it was paid from the shared account, it lives there and is not recorded anywhere else. If one of the two paid it, it is recorded as theirs, with the house owing them that share. Two people looking at the same list cannot arrive at two different numbers, and that is what Mayora exists to guarantee.
Where to start, today
Three things, in this order, and in twenty minutes it is decided.
- Add up what comes into the house, and see what percentage is whose. It is one division and it is the number that governs everything else.
- List what belongs to the house, and only that. Rent, bills, groceries. Decide the two grey areas once, the car and going out, so you do not decide them again.
- Pick the setup. Whole bills each, or a shared account with two transfers on payday.
The hard part is not the arithmetic, it is having the conversation once instead of having it in pieces over a year. And if the house does not yet know what it costs per month, that is the first job, and it is written up in how to build a budget that survives month two.
We keep a page of frequently asked questions about budgeting and everyday money, with a short answer to each one and the full piece one click away. If you want to see it, it is here: frequently asked questions.
This is educational writing. It is not financial advice or an investment recommendation; for advice on products, speak to a professional registered with the CMVM.