How To Handle Finances If You Make More Money Than Your Partner (Or Vice Versa)
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By TESSA SOMBERG
Addressing income inequality in your relationship can be a sensitive topic. Before discussing, you should individually reflect on your attitudes towards money.
Talking About It
Enter the conversation already knowing if you prefer to spend or save and what your joint and individual goals are. Be prepared to discuss without judgment.
Whether you feel that your partner is paying too much or too little, communicate your perspective with compassion, not judgment. This is essential for reaching an understanding.
For those with substantial differences in income levels, splitting expenses according to income may be more fair, easier to adjust, and help tight budgets.
Splitting By Income
To find the ratios, add up both incomes for a combined household total, then divide your income by this number for the individual percent you contribute to the total.
Next, tally up the total of shared expenses and multiply your percentage of the household income by the sum of shared bills to calculate your contribution.
Another way to split bills is to pay the ones that reflect your percentage of the total income. Your partner pays the expenses that make up the remaining bills.
Splitting By Expense
For example, if your income is 35% of the household total and utilities, internet, and groceries account for 35% of total monthly expenses, then you would pay those bills.
This method makes managing expenses slightly easier by giving each partner fewer bills while ensuring each is responsible for a proportional amount.
Prioritize household expenses and keep track of your combined finances more easily using automatic payments from a shared checking account.
Joint Account
It can be a great way to ensure that both incomes, regardless of size, make a noticeable contribution. Surpluses can go into savings to work toward a common goal.
Don’t compromise your savings and critical payments to fulfill a shared obligation that’s beyond your capacity but within your significant other's.
Build Your Wealth
Instead, use a money-saving strategy to build your own wealth. Make it so that payments automatically deposit into a savings account and prioritize eliminating high-interest debt.
In addition to the joint efforts, use your cash to make diverse investments and maintain a retirement account such as a Roth IRA or 401(k).