Automatically splitting payments between people
My girlfriend and I have decided that we want to split expenses 50/50 (or whatever ratio). Currently, we alternate payment, but that means that we have to remember who paid last time, how much, etc. and that makes this issue more salient than we'd like.
So, we want to be able to somehow pay together, and that must happen either upfront or automatically.
Options I see (details are for Israel):
Maintain a cash pool - each of us puts in say 1000NIS, and then we pay out of that pool.
Con: Must use cash, which is inconvenient.
(Current solution) Buy a pre-paid credit card, splitting the payment however we like, and pay using that card. The only pre-paid card in Israel is Visa chargable (???? ????), so:
Con1: Max amount is 1000NIS, so we must re-charge every time.
Con2: 20.30NIS fee for every time we charge.
Get a credit card and split the payment for it together. Now unlike the US, in Israel every credit card bill is automatically deducted every month from a bank account, which one must provide when one gets the card.
Con: AFAIK there's no way to have a card that's deducted from 2 different bank account.
Open a joint bank account, transfer money in there, and have a credit/debit card attached to that account.
Con: Too much trouble, and we're not quite there yet...
I'd like to hear additional thoughts (please remain on topic, and don't derail the discussion to relationship advice).
(4)4 Comments
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I don't know why you dismissed your option 4.
When my wife and I first got together, we opened a joint account and each paycheck, we'd send an amount to the joint account. That account could write checks or use online bill pay to cover bills.
20 years later we still use this 3 account system. After we were married it shifted to us just keeping a bit of money in the individual accounts and sending the bulk of income to the joint account, but you can use whatever contribution method you wish.
It's far easier to send 50/50 deposits and manage one account that to think about splitting multiple bills each month. That joint account is a record of all common expenses, and keeps your own money to yourself, if that's what you wish. The "con" you give for 4 is the least painful in my opinion. And I doubt you'll have an issue telling the card company to change their debit to a new joint account.
I've actually used this site to manage splitting the bill at lunch with a group of coworkers:
splitwise.com/
The disadvantage will be that it's really obnoxious to manually enter a bunch of expenses (but perhaps you could manually enter two credit-card bills?)
I suppose its really a matter of preference. The way it works in my relationship is that we split bills via an income ratio, meaning if I make 60% of the total gross income then I pay 60% of the monthly bills and she just gives me her portion once a month like rent, its very easy. If you are talking about even out to dinner or dessert, movies etc. short of getting the joint account and putting the same amount in every month its going to be difficult to 'share' all of the expense.
You could always just get a credit card and at the end of the month just ask for half the bill, pretty simple. I don't think there is a need to have two bank accounts joined to the credit card for payment, if your this far down the road thinking about things like this then you should be able to implement a reasonably simple thing like the single credit card either in your name or hers and just get half the bill at the end of the month, otherwise if you can't trust each other to do that then everything else is moot.
If you are not living together and don't have things you own together, then this is relatively straightforward. Your only costs are when you are out together - restaurants, movies, maybe gas for a car trip. You have a number of options:
Hang loose and don't worry about it. Do something like roughly alternating payments, with the occasional "you paid for a couple of big things recently, I should pay for this one even though it's your turn". I know you didn't want relationship advice, but learning not to focus on whether your are splitting stuff absolutely fairly is going to be good practice for later in your relationship. As long as both of you are happy with what you are spending, the exact split shouldn't matter.
Try to use credit cards whenever you go out. At the end of the month, go though your credit card statements and work out what was a 'shared expense'. Add up who paid what, and the person who spent the less gives half the difference to the other, to balance out. This can be used together with option 1, so that you aren't too far apart at the end of the month. Forget about cash purchases as being too trivial to keep track of.
Like option 2, but also keep track of all joint purchases, including cash, when you make them. Then factor them into the end of month calculation. Needs more work than option 2, but is more exact. The balance of work to exactness is entirely up to you (and again, working out what balance is good for each of you is good relationship building. What can I say, my wife is a marriage guidance counselor.)
If you don't like alternating payments, try splitting by type of payment: "I pay for gas and movie tickets, you pay for restaurants". Use one of the other options to work out if you are doing the split about right.
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