How to Split Bills With a Roommate

Some people are social creatures and enjoy living with others; most find a roommate to help pay the bills. Though roommates are great money savers, getting down to brass tacks can be awkward depending on how familiar you are with one another and your attitudes towards spending. To minimize the tension, start by finding a roommate who makes about as much money as you do. Then, sit down and make an agreement. Read on to learn how.

Instructions

Difficulty: Moderately Easy

1. Decide who is going to have utilities in their name. The most common of roommate agreements is to split the responsibility; one person takes cable, another electric, etc. Whoever is in charge of a utility is responsible for having it turned on and off, telling each person how much they owe, and sending in the payment on time.
2. Forge an agreement on how payment will be split amongst roommates. You can simply divide each bill by the number of people living in the house. But if you consume resources unevenly, take these differences into account. For instance: if you need premium channels but your roommate doesn't watch much TV, cover the cost of cable on your own.
3. Put your decisions in writing. You can find sample roommate agreements online that cover everything from sharing utilities, the presence of guests and the event of an early move-out. If you feel very confident about the character of your roommate, you can write an informal agreement.
4. Post how much each person owes as soon as a bill comes in. It is courteous to give your roommates as much time as possible to come up with the money. Remember, if a utility is in your name, a late payment will be on your credit report.
5. Make sure any utility you are responsible for gets paid on time. Collecting money and paying the bills isn't exactly fun, but it's better than dealing with angry roommates when the water or electric gets shut off. If you have trouble remembering, have the money withdrawn from your account automatically.

Tips & Warnings

• Instead of dividing up the utilities equally, you might want to assign one person to take care of all the bills in return for a discount on rent. This kind of centralized system can be convenient.
• If you live in a house with many people, consider opening a bank account and having each roommate deposit a lump sum at the beginning of the lease. Money for utilities and other household necessities can simply be withdrawn from the account, instead of having everybody write numerous small checks each month.
• Thanks to the glory of social networking, there are now numerous sites for tracking who owes what online. If your living partners are tech-savvy, you can send them emails letting them know how much they owe you instead of bugging them in person.