How to split expenses as a couple
Splitting rent and groceries is easy. Splitting them fairly when incomes differ takes a decision. Here are the options and what each one does.
There is no single right answer
Couples split shared costs in very different ways, and the right one depends on incomes, values and how much you want to talk about money. Here are the common approaches and what each does to your take-home pay.
Option 1: split everything 50/50
Simple and easy to explain. It works well when incomes are similar. When they are not, the lower earner is left with much less after the same bills.
Option 2: split in proportion to income
Each person pays the same share of their income toward shared costs. If one earns $5,000 a month and the other $3,000 (a 5 to 3 ratio), a $3,200 month of shared costs is split:
| Person | Income | 50/50 | Left after | By income | Left after |
|---|---|---|---|---|---|
| Person A | $5,000 | $1,600 | $3,400 | $2,000 | $3,000 |
| Person B | $3,000 | $1,600 | $1,400 | $1,200 | $1,800 |
| Total | $8,000 | $3,200 | $3,200 |
By income, A pays 5/8 of $3,200 = $2,000 and B pays 3/8 = $1,200. Both put 40% of their income toward shared costs. Under 50/50, B pays 53% of their income and is left with $1,400 against A's $3,400.
Option 3: split by category
One person pays the rent and the other pays groceries and utilities. It cuts down on transfers, but it only stays fair if the totals stay balanced over time. Review it a couple of times a year.
Option 4: a joint account for shared costs
Each person puts a fixed amount (or a fixed share of income) into a joint account that pays the shared bills. There is nothing to track month to month, and a clear rule for what counts as shared.
Whatever you choose
- Decide what counts as shared before you start: rent, utilities and groceries almost always do, hobbies and gifts often do not.
- Revisit the arrangement when incomes change.
- Keep a simple record, so nobody has to rely on memory.
Do it in Settled. Make a group for the two of you. For an income-based split, add each cost as an expense, choose shares, and enter 5 and 3 (or your own ratio): the amounts come out to the penny. Anything just one of you paid for can go in your private Personal section, which only you can see.