When you start living together, a number of things are very important to arrange. Who pays the costs? Do you want a joint account? How do insurance work? These are some questions you should ask yourself before moving in together. Of course, there are many more things that need to be arranged properly.
Who pays for what
It is very important that there is a clear agreement on how the costs will be divided between you. There are different ways to divide the costs. Suppose person 1 earns 5,000 euros and person 2 only 1,500 euros. The common costs amount to 2,500 euros.
Percentage of wages
Most people both contribute a certain percentage of their wages. According to many, this is the fairest option. This way you both still have some money left over, but it is not the case that one has relatively much more money left over. In this case, both people would have to pay approximately 40 percent of their wages for the common costs. Person 1 is left with 3,000 euros and person 2 is left with 900 euros.
Keep the same amount
There are also people who add their income together, deduct the common costs and then divide the money equally. The total income of the above people is 6,500 euros, if you subtract 2,500 euros from this you arrive at 4,000 euros. Divide this by two and you arrive at 2,000 euros, this is the amount they both have left. As you can see, person two has more money left than he takes in wages. This way of dividing is therefore especially a good way if you both receive approximately the same salary.
Same amount
You can also agree to both contribute exactly the same amount to the common costs. In the example above, this would mean that both people would have to pay 1,250 euros. Person one has 3,750 euros left and person two only has 250 euros left.
Joint account
You can both deduct the joint costs from your own private account. It is also an option to open a joint checking account. Such an account is a lot clearer because you both transfer a certain amount to it every month. All common costs such as rent, insurance, groceries and gasoline can be paid from this account. When you separate, you can divide the amount by two because you both contributed the same amount.
Cohabitation contract
When you start living together, this is probably a good time to have your relationship officially recorded on paper. Fortunately, you don’t have to get married right away to do this. It is also an option to have a cohabitation contract drawn up by a notary. After drawing up a cohabitation contract, you are each other’s heirs. You can also record which things belong to whom and what will happen if you break up. On average, you will spend around 250 euros in total to draw up a cohabitation contract.
Arrange your insurance
If you do not yet live in a house together, your insurance policies will also run separately. It is wise to check this carefully as soon as you start living together. You can get a discount on many different insurance policies, for example third party liability insurance, if you live at one address with several people. Also make sure that your entire contents are insured and not just one of you.
Housekeeping booklet
It is not an obligation, but it is a very smart idea to keep a household budget during the first months of living together. In this booklet you write down your income and expenses per period. With a household budget you get a better insight into how much money you have left and on what things you can still save. Some people will be shocked at how much money they still spend on clothes, snacks or trips.
