Moving in with your SO is an exciting time, but for many couples, it can also be the first time you dive into serious talk about money. While you may have talked off-the-cuff about feeling broke, wishing you got a raise or what you’d do if you had a million dollars, stuff gets serious real real fast when you are talking about sharing an apartment and sharing expenses. In these talks, you really can’t hedge, you’ve got to be frank about how much money you have in your respective bank accounts.
Oftentimes, given your careers or financial history, there’s a discrepancy. Perhaps you work at a non-profit and bae works on Wall Street. Maybe your SO is unemployed, but their parents are bankrolling them. Or, maybe they have a trust fund. There are countless ways your financial situation can vary from your partner’s. Therefore, chances are slim that you’ll be in a LTR with someone who makes the exact same salary as you and has the exact same debt. This fact is easy to accept, but coming up with a plan to navigate the discrepancy without building resentment or debt is a lot harder. While every relationship is different, there are three smart approaches to navigating this situation:
- Split Everything 50/50. This approach often feels the most logical and least contentious. It works best when your finances are relatively equal since you’ll probably be approaching spending the same way and have the same definition of what is affordable. This approach doesn’t work as well when one person in the relationship makes significantly more or significantly less than the other person. This also doesn’t work if one partner has a large bill (perhaps student loans, a car payment, medical expenses) that leaves them broke after splitting expenses 50/50.
- Income Proportional. If there is a wide variation in income, this approach can be your best bet. Basically, you and your partner figure out what percentage of your respective incomes you want to devote to rent (standard practice says 30 percent, but in New York City 40-45 percent is the norm). Then, you figure out what that number is for both of you, add them together, and that’s your max budget for how much you can spend monthly on your new digs. For example, say your take-home pay each month is $3K, but your partner’s is $4.5K. Then the max the two of you can spend on a place is $2.25K a month, and you’d contribute $900 of that rent money. This approach makes it possible for your wealthier SO to live in a place that aligns with their “lifestyle” while still giving you the chance to contribute a substantial amount without breaking the bank. Resentment is less likely to build because you’re both contributing what you can.
- Free-for-All. If the income disparity is too great to bridge the gap, consider a free-for-all. Perhaps the wealthier partner takes on the full brunt of the rent with the expectation that the other will fund the remaining shared expenses. A great option if bae is used to living a luxurious lifestyle you can’t afford, this option only works if you and your partner are committed to having frequent, honest conversations about money. It’s pretty easy in this scenario for resentment to build. Your rich beau may start to get annoyed that you’re living rent-free, whereas you might start to feel self-conscious about how little you’re able to contribute. Alternatively, this might lead to arguments about what a necessity is. If you’re broke but left funding the full grocery tab, you might feel inclined to toss out the “essential” $10 block of cheese your SO just added to the cart, triggering an argument. Consider how comfortable you are having uncomfortable money conversations before committing to this plan.