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Salaries and Living Together
Hi Everyone,
How do you guys share your expenses? Are your salaries similar? Or does one of you make more?
So my boyfriend and I have been dating for almost 2 years and living together for almost 1 year. We also live with my 3 year old daughter whose father is not really in the picture.
Up until now, our salaries were very similar with me making about $1,000/year more than him. Consequently, we split all of our expenses (rent, bills, etc) exactly in half.
Now, I had a 2 hour commute and my daughter has some special needs, so I'd been looking for work closer to home. This week, I accepted a new job that will allow me to work closer to our home. However, it pays me $3,000/year less. Meanwhile, in the same week, my boyfriend just got a new job that will pay him $20,000 MORE than what he was making before.
I am seriously thrilled for my boyfriend. However, I am also suddenly feeling sort of lame. Here he is bringing in an amazing new salary, and I am going BACKWARDS.
Also, I'm wondering if we should split up our expenses differently to reflect the new discrepancy in our salaries. I've been nervous about covering my share of the expenses with the pay cut, and now he will have much more disposable income. But that's his money. So I just don't know what's appropriate. . .
Re: Salaries and Living Together
Doesn't matter if you make more money or he does, that you are a committed couple (and probably living together) means both salaries are yours and his together.
There's no "Share" of expenses - what you pay for monthly comes from "our" money.
The job market and how things are now with the job hunt is partially "to blame" for how you feel. Sign of the times; the job market is not what it used to be and I am not certain it ever will be, either.
What matters here:
That you and he get the "our money" model and you are on the same page about how your money and his is saved and spent and invested.
I vote for putting your salaries into one account, paying all monthly invoices/bills from there and putting a certain amount of that money into savings. An "allowance" weekly for each of you isn't a bad idea, either. Spend that on whatever you want.:)(
If you are having trouble getting the "our" money model or you feel funny about it -- see a financial counselor. Have him go with you.
H and I began merging finances when we moved in together, but it wasn't until around when we got married that we started merging everything and calling it "our money." Our salaries are about the same, so for us it worked out to get joint checking and savings accounts when we moved in together, both put the same amount in there each month (we did $250 checking, plus savings for a specific goal/timeframe for our wedding) and to buy groceries & meals out with "our money."
With two different incomes, if you're not ready to call everything "our money" (and I personally think that's smart since you're not even engaged yet), here's a good way to make it fair: take your income and divide by your and his total income each month. Then add up all your shared bills: rent, renters' insurance, utilities, groceries, etc., and multiply that by the number you got before. That's how much you need to contribute each month. For example, if you make $2000/mo and he makes $3000/mo, your total income is $5000/mo, so your portion is 2000/5000=.4, or 40%. If your total joint bills are $1500/mo, you would pay 40% of $1500, or $600. He would pay the remaining $900.
"You know you're in love when you don't want to fall asleep because reality is finally better than your dreams." - Dr. SeussI have a friend who was making significantly less than her DH (she went from working FT to PT after having kids). But they had initially kept splitting everything in 1/2. But then her DH wanted to basically do things/spend money that she simply could not afford.
She told him that they had to either start splitting bills etc based on what they brought in, or if they kept it at 50/50,they had to live based on HER salary, not his. Because she couldn't afford it otherwise!
So... you all need to figure out what will work for you. You're not married so I understand keeping $$ separate, but as you're living together AND you have a child - I think that you all really need to start thinking more on a "we" page than on a "mine and yours" page when talking about your overall financial picture.
Doesn't mean you have to literally merge all your money. Many married couples don't (including me). It works. BUT DH and I are on the same page w/ our overall budget and where our $$ goes.
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There are so many couples out there that have differing salaries. When I was with my H before we were married, I made way more than him because he was in school part time and sometimes full time. Actually, I still make more than him. He helps out in other ways by helping around the house and cooking when he can and paying for the car. But as long as you can live comfortably, it shouldn't be about who makes what. Obviously if you were both struggling to make ends meet, you wouldn't want to take a pay cut. You should start thinking of it as "our" money, not "mine and his" although I don't think you should merge bank accounts yet. I feel like that should wait until marriage or at least an engagement. Just my opinion.
Anyways, the key is communication. You say he is a giving/caring person so these differences should not matter to him. Definitely make sure he's on the same page as you though about finances.
Yes, we kept our money separate until we were engaged/married. We split the bills 50/50 when we were living together without an engagement.
This.
Everything was 50/50 till we said "I do." Regardless of our incomes. We also didn't have the house in both of our names, nor the cars. He owned the house, I paid him "rent", and we each owned our own vehicles and paid for the insurance on them separately. I wouldn't do it any differently. Too many things can happen when you are just dating.
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It really just depends on what works for both of you. You're only dating so I don't believe it's necessary to share the wealth like a married couple might. But if he's ok with it then I don't see a problem. Talk to him about how he wants to handle the finances, communicate what you want, and figure out what you guys are going to do. No sense in worrying about it if you aren't going to discuss it, right?
And don't beat yourself up over this, the pay cut you're taking. It's allowing you to be home with your daughter more and being a Mom is a job in itself. And you will reap greater rewards for that then you would in collecting a fat paycheck!
This seems like a good option if you still want to keep things separate but "equal". Also, if your child has special needs, so you know if you qualify for disability income for the increased cost of care for your child? It might help out with extra expenses.