Managing Money With Roommates – 8 Do’s & Don’ts

roomatesLiving with others isn’t easy. Several years ago, my friends and I decided to get a house together. We were all incredibly excited and made promises to split everything evenly, from rent, to utilities, to chores. However, it wasn’t long before the problems started. One roommate was constantly late in paying his portion of the bills. Another was obsessed about splitting every cost, even the $0.99 dish soap.

I learned pretty quickly what works and what doesn’t in a shared living environment. There are specific things you need to make a part of your routine, and others you must make a point to avoid.

Money Do’s

Here are four rules to stick to no matter what the dynamics are like between you and your roommates:

1. Be Direct Regarding Who Owes What

I’m not saying you should bang on your roommate’s door at 7am demanding his or her portion of the electric bill. Instead, just ask politely for the money. In my situation, I paid the rent and everyone gave me cash so I could write the landlord a single check.

I grabbed a basket, labeled it with a “collections” sticker, and waited until everyone was home to walk around the house collecting money. It was amusing enough so that no one felt that I was being bossy, which helped keep things running smoothly. But whatever you do, don’t wait until the due date to start asking for money. Give your roommates at least 72 hours’ notice.

2. Buy Furniture Separately

The simple rule is: If you buy the couch, you get to take it with you when you move out. The thing that makes this a little more complicated is that the couch may incur more than one spill or rip as everyone uses it. For example, when I lived with four guys and one girl, the loveseat I bought had so many broken springs by the time I moved out that I didn’t want to take it with me. However, my 42-inch flat screen TV was perfectly intact, and I’m still enjoying it today.

Discuss with your roommates who is going to buy the various pieces of furniture needed for the apartment. If the wear and tear it’s going to endure is a big concern, consider buying used pieces. It’s a lot easier to accept a broken spring on a cheap second-hand couch than a brand new piece of designer furniture.

3. Make a Chart

When I lived with five other roommates under one roof, the best way of keeping track of who owed what was to create a chart each month and keep it on the fridge. It listed everyone’s name along with columns for rent and utility costs. As people paid, their names were crossed off. Everyone knew who had paid and who still owed – a great way of keeping everyone motivated to pay on time.

Just make sure everyone is on board with this before putting up your chart. If you do it without warning, your roommates might feel attacked, and that can only lead to tension and arguments.

4. Go to the Store Together, Check Out Separately

I’ve never loved shopping for groceries, but it’s certainly a lot easier when I do it with a friend. If each roommate takes a basket, everyone picks out what they want and pays separately. That way, you each know exactly what you’re buying and how much you’re paying).

If you’re planning on making a shared meal together, assign everyone a different ingredient. When you’re ready to cook, everyone who wants to eat has something to contribute. Either that, or have each roommate cook his or her own weekly meal on a rotating schedule. All the ingredients are the chef’s responsibility, so there won’t be any confusion – although there might be some differences in quality from week to week.


Money Don’ts

To make for a happy household, avoid these pitfalls at all costs:

5. Don’t Split the Cost of Furniture

It might sound like a good idea for everyone to split the cost of a living room set, but it’s not. You and your roommates are going to move out one day, and you can’t cut the couch in half. If you do split the cost, be prepared to leave it behind, trash it, or deal with selling it on Craigslist.

To keep things fair, discuss who’s going to buy what furniture ahead of time, and make sure everyone contributes beyond their bedroom. For example, my old roommate and I completely furnished our two-bedroom house by dividing up the rooms. She bought the dining room furniture, and I bought the living room furniture. This way, we each contributed and had things to take with us when we moved.

6. Don’t Leave Passive-Aggressive Notes

A former roommate of mine loved leaving notes, and they covered everything: The dishes in the sink needed to be cleaned (smiley face); she didn’t like the ketchup in the fridge (winky face); and she even once let me know via a sticky note that she couldn’t pay the utility bill on time (frowny face).

This drove me and my other roommate absolutely insane. If you have a problem, need help, or just want to see a change in the house, talk about it. Odds are that your roommates are happy to help as long as you’re understanding, polite, and direct. We wouldn’t have thought twice about helping our roommate with the utility bill if she’d approached us and told us why she couldn’t pay. No one wants their electricity shut off. However, she came to us two days after the bill was due, and never mentioned it face to face.

Of course, notes are sometimes called for. You and your roommates might work different schedules, missing a chance to talk to one another in person. If you have to leave a note, just make sure it’s necessary. Stick to bills, maintenance issues, and other important stuff – and skip the ketchup complaints.

7. Don’t Share Grocery Costs

An old roommate of mine used to split the grocery bill with me, but unfortunately, we liked eating different things. She enjoyed expensive organic produce that I thought was unnecessary, and I went for the “buy-one, get-one” bulk deals. It was frustrating and easily avoidable.

Shop on your own or use two different carts if you go shopping with your roommates. To reduce your grocery bill, shop for fresh produce at your local farmers’ market, buy in bulk from warehouse clubs and wholesalers, clip coupons, and look for print-at-home Internet coupons for your favorite brands.

8. Don’t Pay Bills Until Everyone Contributes

I once paid the rent before two of my roommates had given me their share. One had been recently laid off, and the other had gone on vacation and was impossible to get in touch with. It took me several months to get that money back, and believe me, I asked for it every week. No one likes to owe money, and no one likes to ask for money. In retrospect, I should have asked my other roommates pitch in and help cover the missing portions of the rent. After all, it’s everyone’s communal responsibility, not just yours.

If you pay the rent and collect from your roommates, make it clear that you need their shares in advance or you’re going to have to look for new roommates. Keep a record of your bills, especially if your roommate owes you money. If you pay the rent with a check, write a bill showing your roommate’s portion due and keep a copy of the check. Hopefully it never comes to it, but you might need that evidence in small claims court one day.

Final Word

Living with roommates isn’t always easy, but it is definitely cheaper. Personally, I wouldn’t have gotten through those low-paying jobs in college or been able to build much of a savings account without having roommates to help split the high costs of living. As long as you plan ahead and keep all lines of communication open, a roommate can be a great money-saving – and fun – experience.

Have you lived with roommates before? Do you have any great stories (or nightmares)?

  • Mario

    We manage expenses on a Google spreadsheet so it’s alls public; since there are three of us it’s never a me vs you discussion so no hurt feelings. I don’t split grocery costs with my roommates, which is a real shame since we could do so much saving with bulk buys (I still buy in bulk on my own to save money and so do a lot of freezing and stockpiling)

    • Angela Colley

      That is a great idea Mario. If I still had roommates, I would start using Google Docs to keep things public.

      • Mario

        Thanks! Besides feeling more fair, it also makes the accounting a lot more automated :)

  • @debtblag

    Another thing to add (since I saw this on Twitter again ;) ) regarding furniture. What I always suggest with roommates is that we split the cost of furniture, but the person keeping it after pays two shares. For example, when my two roommates and I bought a (used) $100 dining table, we split it four ways and since I was going to keep it, paid $50 to my roommates’ $25. It’s imperfect, but the math is easy and it feels close enough to fair to make people happy :)

  • Madel

    This is really funny to me because I’m currently living with roommates right now and ALLLLLLL they do is leave passive aggressive notes. A fucking trail of em. Very angry passive aggressive notes may I add, but when they’re face to face everything’s all dandy. So the atmosphere is always really awkward because it becomes really hard to address these issues, and adds a lot of tension. Very good rule.

  • S

    Ooooooh my god. I am so sick of passive aggressive housemates. They never say something to your face and deliberately wait until you’re not home to either leave a written note or send you a text saying something like “can you not leave dishes in the sink? thanks :)” while at the same time, always having an excuse to not pitch in for bills. My current housemate even had the audacity to say to me “I’d help out with the internet bill, but I have no money this week” and then a day later was buying an outfit online for some cocktail party. I seriously wish I could just live on my own, but can’t afford to…

    • Denise Lynn

      Why are you leaving dishes in the sink? I’d be writing notes too and sticking um on your forehead. And it wouldn’t be because I was afraid of telling to your face I’d do it because you’re STUPID! Get your sh_t out of the way!

      • wc

        Denise i would stuff my sticky notes up your “intimate womanly bits”. No one wants to live with an angry witch of a roommate. :-)

  • Amercan111

    I’m in nursing school and thought I found a good deal. Not so much. About 6 mos into this, I realized my rromate who owns the house is in pretty bad financial shape. Not to mention she moved her son and his girlfriend back home for 4 month during the summer (running up all the bills but they pay nothing). I have always paid half of everything and my rent 2 months ahead. Recent letters include the fact that the Home Owners Association fee was never paid (lawyer wants $1,500) and today we got a notice that the water will be shut off due to non payment! Did I mention that our electric bill is $500 plus this month because she never paid it with the money I’ve given her for the last 2 bills? Now she expects me to split this AGAIN but I’ve already paid? Now before you say just move…I can’t because of school term. Any suggestions? I document everything and have receipts. I cannot afford to rent this room if I keep paying for the bills twice or 3 times and they still don’t get paid! I kind of need water, heat, and electric?

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  • keith

    I am currently living with 3 roommates, 2 of which are a couple and share a bedroom. I cant believe I have to ask this question as it seems to me to be a simple case of common sense. But here we are over three years in and it has come up again and causing tension between us. So here it is. When splitting utilities should it be split 3 ways or 4 ways? Any and all responses are greatly appreciated and hopefully assist me at putting this issue to rest. My take of course is 4, if your living there then you are using the utilities and should pay your fair share! What do you think?

    • Jon

      Utilities should always be split between the number of people that live in the household. If there are four people (including your couple), then it should be split four-ways. That’s really the only fair option.