How to split costs with roommates

Next, have a conversation about your budget for these expenses and how you’ll split them—and don’t leave anything to chance. For example, you may assume they should be shared equally. But your roommate could want to take an income-based approach, where you each pay proportionally based on your respective salaries. Getting everything out on the table can help limit unpleasant conversations down the road. Create a plan together and answer questions like:

• How will you split the security deposit?
• Will you split fixed bills, like rent, equally or take a different approach?
• Who will set up utilities like internet, water, and electricity, and whose name will be on the bills?
• Who will be paying for entertainment services that you share, like streaming platforms?
• Will you plan for any ongoing expenses, like home security or a regular cleaning service?
• Are there any big initial purchases you need to make together, like buying furniture?
• Do you plan to share groceries or cleaning supplies? And if so, how?
• Will you set up automatic payments for all your shared bills?
• How will you send and receive money between each other?
• What will you do if someone can’t afford their portion of a bill one month or loses their income?
• Will you set up a shared emergency fund to help pay for any unexpected expenses?

“Open communication involves honesty first—saying what’s going on with you—and then moving to problem solving,” says Bright Dickson, an expert in positive psychology and co-host of the Money and Mindset podcast.

When you’re talking to your roommates about something sensitive, Dickson recommends using “I” statements instead of saying something that could seem accusatory. So instead of, “You never pay the utilities on time,” you could say to your roommate, “I feel nervous when the utilities aren’t paid the day they’re due.”

Talking with your roommates about how to split costs can do more than help improve your financial future—it can help prepare you for important conversations about money with your friends or your significant other.

“It’s a fantastic opportunity to not only solve a problem, but to build a skill that you will need for the future, which is the skill of clear communication,” Dickson says.

Regularly chatting about shared expenses with your roommates can help maintain a healthy and happy household. And it might even lead to talking more about your personal financial goals and rooting each other on.