How to manage your finances when you move in together

Moving in with your partner is an exciting time, but it can also be nerve-wracking. On the one hand, you get to see each other more and spend quality time together. On the other, sharing a living space can be a big change – and you’ll get to know all their irritating habits.

There might be some bickering over furniture and decor, but these aren’t likely to end in a break-up. But arguing over money can turn ugly, so it’s important for both parties to have finances in check before signing for an apartment together.

Here are some tips to bear in mind when you’re planning to take the next step in your relationship.

Talk about money

Few people enjoy talking about money, but it doesn’t have to be awkward and uncomfortable. Making sure you are both on the same page and being open about your income and spending is important when you share the responsibility of paying the rent.

“When moving in with a partner, it's so important to have a money talk ahead of time,” says Catherine Alford, a family finance expert. “Since you'll be sharing a home, groceries, and some bills, it's helpful to have an honest discussion and make a plan on how to divvy up costs. You can decide to split bills and expenses evenly.”

It can also help to set aside a time each month or every couple of months to talk about money and spending. It might not be the most fun date, but it’s important to make sure you’re both happy and open about the way things are financially.

“Ultimately, a couple is unique, so the best way to handle finances together will vary based on a number of factors and extenuating circumstances,” Alford adds. “What is important for all couples, though, is to maintain an open and honest dialogue about money, no matter how difficult the conversation might be.”

Try a ‘living together agreement’

It might not sound very romantic, but the Money Advice Service recommends drawing up a “living together” agreement – as couples who live together have very few rights in law if their relationship ends. If you agree about what to do with your home, shared possessions, bills and debts before moving in together, it will save a lot of time and worry if things don’t work out.

It’s also helpful to write down the dates when bills go out and exactly how much you both need to contribute. Advicenow.org.uk has a good guide to putting together an agreement.

“Over communicating is better than under communicating when it comes to money, and that includes discussing worst case scenarios, like what happens if you break up and how that will affect your finances,” Alford adds.

Organise sharing your expenses

Another way to manage money as a couple is to have each partner contribute the same percentage of their income to shared expenses, Alford explains. “Some factors to consider are each partner's income and your individual and joint goals,” she says. “For example, maybe one partner wants to pay down debt aggressively so the other takes over a larger percentage of the expenses.

“Or, maybe one partner has a child to care for or other responsibilities that need to come directly from their own income and so they might have less to contribute to shared expenses.”

Have an emergency fund

It can be useful to have savings – perhaps in a separate bank account – if things go wrong and you find yourself in financial trouble. This might be handy if you end up with an expected bill, lose your job or if you break up.

Although it’s likely you aren’t planning to end the relationship if you’re moving in together, it’s always advisable to have a safety net just in case.

Joint account

A joint account can be helpful when it comes to paying the rent or paying bills, so the money doesn’t just go out of one person’s account. It also allows you to both put aside cash for rent, bills and other expenses.

There are some disadvantages too, however. The biggest issue is that the bank or building society can ask either one of you to pay off the whole debt on a joint account – such as an overdraft – if they wish. So if you and your partner break up and they refuse to pay, you could end up paying the whole lot.