Moving out on your own is a major life experience. Chances are the first time you leave home, you’ll have roommates. These could be friends, acquaintances, colleagues, or sometimes even strangers.
No matter the circumstances, it’s an exciting change, as you’re going to be able to embrace your independence while at the same time putting those hard-learned life skills to use.
One of the most important life skills you’ll be developing is financial responsibility. You might be aware of the value of money, and recognize it’s important to budget your expenses based on your income and savings. Unfortunately, your roommates might not have the same financial prowess you wish to achieve.
Poor communication regarding expenses and failing to properly track it can lead to a whole lot of unnecessary stress. Good financial planning and using a roommate expense tracker can help prevent a lot of headaches.
By using an expense tracker, you can make sure that each roommate is properly contributing their share of payments for expenses, and help everyone stay on top of their finances.
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Splitting bills with roommates
There are a lot of expenses when you move into your own place. Rent, food, hydro, internet, insurance, cell phone – you’ll undoubtedly be spending more money per month than if you were still living at home. So, living with roommates helps to ease the financial burden.
You might think that by living with three other people all you have to do is divide your bills by four, and everyone pays their fair share. Unfortunately, that’s not always as easy as it seems. Some roommates might be late on their payments, some might feel that they didn’t use the internet as much as others and therefore shouldn’t have to pay the same amount.
Simply put: problems can and do arise.
A roommate expense tracker is a convenient spreadsheet that allows you to clearly show the total bill cost, what each individual’s contribution is to be, and who has and who hasn’t paid. Using a simple spreadsheet is a great way for everyone to see who owes and who has paid what, and can prevent a great deal of misunderstanding and miscommunication.
We built a roommate expense tracker spreadsheet to make this easy for you and your roommates. It’s a Google Sheets, so click the file, then “make copy” and you can begin to edit.
Download the roommate expense tracker worksheet
How to use our roommate expense tracker spreadsheet
Step 1: Edit the names of your roommates
Click into each cell and change the names to reflect the names in your household. Once you change the names in this row, it will auto-populate the “who paid” dropdown menu.
Step 2: Fill in your shared expenses
Did your roommates share pizza recently? Do you all use the same internet connection? How do you buy groceries? Do you share a Netflix account? Enter in all the shared costs and if you need more rows, simply right-click (control+click) on the numbered row and insert row either above or below. To add multiple rows, first select multiple empty rows and you’ll add as many rows as you’ve selected.
Step 3: How to split expenses
If everyone is using the internet, it could be an equal split. But what if Tyler demolished 8 slices from the large pizza and Jessica and Graham only ate 2? Alyssa wasn’t there that night. Well, you can variably split the bill using the drop-down menu then enter in the percentage attributable to each person. In a 14 slice pizza, Tyler at 60%, Jessica and Graham each ate 20%, and Alyssa is at 0% – adjust your numbers accordingly.
Step 4: Let the spreadsheet do the work
By selecting how to split as “variably,” you can enter percentages. If the bill is to be split equally, just click to checkmark the boxes of who is in on the bill. In this image, Tyler opted out of the grocery store run because he was away that week. So, the bill is shared between Jessica, Graham, and Alyssa.
Then, once you’ve sorted out who owes what, you can split the bills equally or variably, by clicking the “simplify who owes what to whom” the spreadsheet will automatically calculate who has to pay what to each person.
Next month, you can either erase all the cells (after the bills are settled) or just keep adding new rows.
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Should all roommates split utilities equally?
When thinking about how to split bills with roommates, the question will undoubtedly come up if everyone should pay the same amount. Should the person with the largest bedroom have to pay more of the rent than the person with the smallest? Should everyone contribute to the Netflix subscription even if only a few of you use it?
These are questions to which there are no simple answers, but ones that everyone will have an opinion on.
When looking at sharing a space with others, it’s important to ask a lot of questions before the living arrangement begins. There are many considerations, like who’s going to be named on the lease, who’s responsible for paying bills and collecting money, and how you’re going to divide bill payments.
TIP: Before you agree to rent a space together, consider creating a contract with your other roommates. In the contract, specify who will be responsible for paying what percent of a bill, what the payment schedule will be, and what late-payment penalties there are, if any. Especially if the person responsible for paying is late paying - who will pay the surcharges? This will help you when you’re creating your roommate expense tracker, and having everyone agree to and sign a contract in advance will ensure there are no debates along the way.
So how do roommates split expenses?
The easiest way is to take a bill and divide it equally amongst the roommates. If everyone agrees to this, you’re off to the races, and creating your roommate expense tracker will be easy.
If you decide to split bills based on usage and other factors, then you’re going to have to do a bit more work. If, for instance, there is one room in the space you are renting that is larger than the others, you will have to agree on what the value of the larger room is in relation to the other rooms.
For example, if you have one roommate, and one bedroom is larger than the other, you might decide that a 60-40 split is a better arrangement than a 50-50 one for rent. Thus, if rent is $2000 a month, then one person would pay $1200 while the other would pay $800. Again, you can use the sheet and split it variably.
Whatever terms you agree upon when splitting bills in a shared house, it’s important that all members of your household are clear on the arrangement, and everyone agrees to pay their fair share.
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How to split groceries with roommates
It’s 2 A.M. and you have a hankering for a snack. You make your way to the kitchen, only to discover that all the nachos are gone. What gives? You bought those yourself!
Splitting groceries with roommates is tough. You can spend time labelling everything you purchase, or all contribute to a grocery fund and buy collective food. Whatever you do, making sure that you budget for groceries is a critical step.
When figuring out a grocery plan, be sure to agree with your roommates about how you’re going to proceed. If you’re buying collective groceries, see how much you’re going to spend on food a week, and divide it by the number of people in your household.
TIP: No doubt, you’re going to have your own particular food wants and needs, and your roommates will too. If space allows, it’s always a great idea to have a shelf in the fridge and one in a cupboard allocated to each of your individual groceries. That way, if you want to purchase a specific food outside of the collective grocery agreement, then you simply store it on the shelf and it’s there for you whenever you want it.
How to send money to your roommates
Running to a bank at the last minute to get cash to pay rent is tiring. Cutting cheques that you hope don’t bounce can be a headache. Luckily, technology has come to the rescue in terms of sending and saving money.
As you no doubt know, e-transfers are a fast and easy way to send money to others. What’s great about e-transfers is that you can send money on your own time using your bank’s website or app.
Simply log in to your account, send the money to the recipient’s email address or phone number, and you’re done. If you’re waiting until payday to send money, you can conveniently transfer the cash as soon as it’s in your account – you don’t have to wait to find an ATM or a bank that’s open.
TIP: Most banks offer a financial planning component to their websites and apps. These can be great ways to help you budget and save money for your financial goals.
There are other money transfer apps that can help save you time – and allow you more personalize your payments. Apps like Venmo, Wealthsimple Cash, Apple Pay Canada and Google Pay Canada are great ways to send money to your roommates when they need it. [Note that as of writing this, Venmo is not yet available in Canada.]
The bottom line
When it comes to roommates, a lot of stress and aggravation can be avoided if you take the time to establish a roommate expense tracker. Budgeting you and your friends’ money will ensure that you never miss a payment and that you aren’t spending more than you have. Not only will establishing good budgeting habits benefit you and others in your house, but it will also help nurture a lifetime of great financial habits.