Moving in together – what does it mean for your finances?
What did your partner give you for Valentine’s Day? Flowers, chocolates, lingerie - or maybe the spare key to their flat? If it’s the latter, and you’re moving in together, it’ll be an exciting time for both of you. But there are also lots of things to think about – not least your finances! In the whirlwind of romance, it’s easy to forget about money, but it doesn’t have to be a headache or end in arguments - as long as you plan carefully.
Starting out
Before you’ve even started to daydream about making pancakes together in your pyjamas, you need to have a serious chat about money. Be completely honest and tell each other where you stand, including any credit card debts and outstanding loans.
Also discuss your monthly outgoings, from topping up your Oyster card or paying for petrol, to how much you spend on nights out.
Disclose how much you earn a month and then work out whether you’ll split bills and rent 50-50 or, if one partner earns more, decide on a fair division.
What you’re paying for
If you’re going to look for a place to rent together from scratch, you’ll have to pay a deposit on your new home. It could be that one of you pays the deposit, or you go halves - but it’s worth keeping a note for future reference. Also consider a six-month contract, so you get a trial period of living together and you’re not tied in for a full year if things go wrong.
There’s also the question of furniture. It could be that you already have some, but if you do a big shopping trip, decide who’s going to pay for what in advance – and keep a record of it.
Then comes the boring part: bills. If you’re moving into your partner’s existing home, things like council tax, electricity, gas and water will already be set up in their name, so work out how much you should be paying them back each month. Now could be a good time to look at switching utility providers for the best deal.
Decide whether you need a landline and internet – or if you’re happy just using your mobile phones with separate bills.
Food shopping should be fun, but can turn nasty if you quarrel over whether you’re buying basic or best – so always write your list together first and stick to it; grocery shopping online is by far the easiest way.
Don’t forget about home insurance, you’ll need this to cover your possessions even if you are renting. And if you are moving into your partner’s place, make sure his or her policy will cover your stuff, especially any expensive items. Get some cheap home insurance quotes and work out the best deal for both of you.
If you’re buying a house together then you should also think about mortgage life insurance to cover you and your partner in case the worst happens.
Setting up a joint account
If you’re renting somewhere together and don’t want to quibble over who pays which bill, it’s worth setting up a joint bank account to manage your direct debits.
It’s unlikely one of you will do a runner with all the cash, and it means you know exactly how much money you have left in your own account come the end of the month for things like clothes, the gym and nights out - without asking for permission to spend on yourself.
You’ll both need to be present at the bank at the time you set up the account, so arrange a convenient time to do this. You’ll need to decide what percentage of your income you’re going to transfer each month into the joint too.
The great news is, once you’ve made all the financial arrangements, you should both be better off – and you can finally relax and enjoy those pancakes.
