Splitting Expenses

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mushyyy
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Splitting Expenses

Post by mushyyy »

My girlfriend and I have always split expenses 50/50, because we were contributing equally to our household income.
Currently we are on a 60/40 split, as she is earning more than me and this arrangement works for both of us.

Let’s assume 2 situations:
- We bought a car together and we paid 50/50. Now we are selling the car. How should we split the proceeds?
- We bought a house together and we paid 50/50. We have held it for 10 years, in which my girlfriend contributed to the upkeep and eventual upgrade in a 60/40 manner. Now we are selling the house. How should we split the proceeds?
HomeStretch
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Re: Splitting Expenses

Post by HomeStretch »

You should split it in whatever way is agreeable to you and your girlfriend.

Do you or girlfriend have a disagreement on how to split?

If there is a significant difference between a 50-50 split and a 60-40 split that matters to one or both of you, one option is to make sure each receives back the money they put in then prorate the profit or loss -
- 50-50 for the period you split 50-50
- 60-40 for the period you split 60-40
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Sandtrap
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Re: Splitting Expenses

Post by Sandtrap »

From a financial planning and investment perspective:

Is there legal marriage somewhere in the picture now or in the future?
When?

j :happy
Last edited by Sandtrap on Mon Oct 12, 2020 1:09 pm, edited 1 time in total.
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Kelrex
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Re: Splitting Expenses

Post by Kelrex »

Frankly, what strangers on the internet think is fair is entirely irrelevant.

What do you think is fair, what does your SO think is fair.
Did you not discuss these types of things when you I totally discussed splitting things 60/40?
If not, then now is a good time to talk it through in detail, along with any other future splits that may come up.
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Cobra Commander
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Re: Splitting Expenses

Post by Cobra Commander »

I would split the car 50/50 because most of the expense is in the purchase price (assuming you paid cash or finished making financing payments while still 50/50).

For the house, I would split the gains 50/50 up to the point when you switched to 60/40 and any subsequent gains 60/40. I would allocate all selling expenses in the same manner as the ultimate split ratio.
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SmileyFace
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Re: Splitting Expenses

Post by SmileyFace »

I believe what you are asking for is opinions since there is no 1 right answer here.
My opinion: - if you are planning on buying a house and living it for 10 years you should just get married and combine finances versus living a lifetime playing a splitting game.
tibbitts
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Re: Splitting Expenses

Post by tibbitts »

mushyyy wrote: Mon Oct 12, 2020 7:17 am My girlfriend and I have always split expenses 50/50, because we were contributing equally to our household income.
Currently we are on a 60/40 split, as she is earning more than me and this arrangement works for both of us.

Let’s assume 2 situations:
- We bought a car together and we paid 50/50. Now we are selling the car. How should we split the proceeds?
- We bought a house together and we paid 50/50. We have held it for 10 years, in which my girlfriend contributed to the upkeep and eventual upgrade in a 60/40 manner. Now we are selling the house. How should we split the proceeds?
I think you overly complicated your life with the change to 60/40, because now you have some "before" funds mixed with some "after" funds. If you had stuck to 50/50 you could just limit expenses to what the lower income earner is comfortable contributing half to, and let the other person save more.

I don't see why people are suggesting you get married, because that really depends on factors that haven't even been discussed in this thread.
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8foot7
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Re: Splitting Expenses

Post by 8foot7 »

I would strongly encourage you NOT to get married if you find you can't agree to an expense split in your current arrangement. If there is static now, as boyfriend and girlfriend, about a 10% difference in costs, there will be more profound disagreements later.
dewey
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Re: Splitting Expenses

Post by dewey »

"I don't see why people are suggesting you get married, because that really depends on factors that haven't even been discussed in this thread."

+1
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JPH
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Re: Splitting Expenses

Post by JPH »

mushyyy wrote: Mon Oct 12, 2020 7:17 am My girlfriend and I have always split expenses 50/50, because we were contributing equally to our household income.
Currently we are on a 60/40 split, as she is earning more than me and this arrangement works for both of us.
What a question! I don't even understand how a 60/40 split equals a 50/50 split. You need a pre-marital prenup.
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Barsoom
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Re: Splitting Expenses

Post by Barsoom »

I think the simplest answer is to split the proceeds 50/50 and then you can pay back the excess 10% that she paid from your share of the sale.

-B
mortfree
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Re: Splitting Expenses

Post by mortfree »

55/45

That should do it
azianbob
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Re: Splitting Expenses

Post by azianbob »

Just split the house gains 50/50 and let the GF keep 100% of proceeds from car to even out any period she paid 60/40 ... should be about even and easier calculation.
Topic Author
mushyyy
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Re: Splitting Expenses

Post by mushyyy »

Thanks to all the answers.

Of course there is no right answer, i’m curious what others are doing in a similar situation.

We are planning to get married next year, so that will solve any potential issue.
But until then, i will probably split everything fifty fifty, regardless of the current situation.
Cruise
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Re: Splitting Expenses

Post by Cruise »

mushyyy wrote: Sat Oct 17, 2020 2:03 pm Thanks to all the answers.

Of course there is no right answer, i’m curious what others are doing in a similar situation.

We are planning to get married next year, so that will solve any potential issue.
But until then, i will probably split everything fifty fifty, regardless of the current situation.
50/50 was our mantra from the beginning, 38 year ago. We figured that was the best way to start a relationship, and it worked.

Good luck.
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LadyGeek
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Re: Splitting Expenses

Post by LadyGeek »

The discussion is getting derailed on relationship issues. Please stay focused on the financial aspects.
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Katietsu
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Re: Splitting Expenses

Post by Katietsu »

Personally, I would hesitate to buy a high expense item like a house or car jointly before I got married. I would just have one person buy a car and both could contribute to ongoing expenses in some mutually agreed upon way.

If you are going to make these big purchases though, you are thinking about the right things with your question. I would go one step further and suggest whatever agreement you reach is put in writing. Society has a well established framework to divide assets when married people separate, ie divorce. Without marriage, you will need to establish your own rules for the division of assets if you want to avoid a major headache. For real estate, I would go further and consider using a lawyer to memorialize your agreement.
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Re: Splitting Expenses

Post by LadyGeek »

A contentious interchange regarding relationships (marriage - relationship issue) has been removed. This thread has run its course and is locked (topic exhausted). See: Locked Topics
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