Money Management

Many couples split expenses rather than combining your finances. Read on to learn the best way to have a discussion and decide what’s fair. 

If you and your partner are not combining finances and paying for things out of a joint checking account, you’ll need to come up with a plan for how to share expenses. This can be tricky under the best of circumstances, but becomes even more complicated if one of you makes significantly more money than the other.

To make sure you’re on the same page about how you’ll pay shared expenses — and to reduce the chance of money fights over credit card debt or other costs — consider these tips to come up with a plan for splitting up costs.

1. Have an open discussion

Talking about money can be touchy, especially when there is an income disparity. But, it’s crucial to make your relationship work. And, you need to make absolutely sure you are 100% open and honest in your discussion — especially since close to half of all respondents to a recent survey indicated they believe financial dishonesty is a type of infidelity.

To facilitate a useful discussion about how you’ll split expenses, set aside a time to have a discussion and be sure your partner isn’t blindsided. You can each come prepared with some proposals about how you think it’s best to split up your costs — and should also be ready to discuss the reasoning behind your desires.

When you have the discussion, remember that the goal is to find compromise — not for either of you to “win.” You don’t want to place blame or dismiss your partner’s thoughts. Since splitting expenses is likely to be an ongoing issue for the entire time you’re together, you really need to find something you can both be happy with.

2. Split expenses fairly, not necessarily equally

While it’s up to each couple to decide what works for them, it usually doesn’t make sense for couples to split things 50/50 when there is a big earning disparity. Trying to take this approach is likely to lead to resentment on the part of both parties, with the lower earner potentially feeling cash-strapped and the higher earner feeling constrained or like they’re missing out because they can’t afford to do things if their partner can’t split the bill.

For many people, a good option is to figure out what percentage of combined income each person earns and then have each person pay that percentage of your expenses. For example, if you make $20,000 and your partner makes $80,000, you could pay 20% of shared expenses while your partner pays 80%.

While this arrangement may not seem perfect to you, you should try to work together to think about what is actually fair to both of you so you can find a system that allows you to do things you want without placing too large a burden on either partner.

3. Re-evaluate as your life circumstances change

When you decide how to split expenses, it’s also important to realize you may need to change things over time. If one of you changes careers, goes back to school, or experiences another big life shift — or if you have children together — you may need an entirely different approach.

Schedule regular times to revisit your plan for sharing costs and make time to re-evaluate after any big upheaval so you can make sure your arrangement continues to work.

4. Make sure joint financial goals make sense for both of you

Finally, think about what goals you’ll work towards together and share costs on, and what you’ll keep separate. For example, if you’re buying a house together, it makes sense that saving the down payment would be a joint goal you’d both work towards and that you’d share the expenses of that house. But if the higher-earner wants a fancy sports car that only they will drive, it may not make sense to split expenses related to that vehicle.

By implementing these tips, you may be able to find a system that allows you to share your money in a way that makes sense and lets you accomplish big financial goals together as a team.

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It’s scary when you can’t afford to stay in the home you bought. Read on to learn about short sales and how they work. 

I’d rank my first home purchase, when I was in my mid-20s and far less financially savvy than I am now, as my biggest money mistake. I got a mortgage loan to buy that house for the wrong reasons (namely, I was sick of living in my apartment) and with absolutely no cash reserves of any kind. In short, I could not afford a house.

It was a bone-headed thing to do, and I ended up in a world of hurt when my life changed drastically in the space of six short weeks just two years after buying it. After getting laid off from my job and leaving my now ex-spouse, I went further and further into the hole on my house payments for more than three years, until I finally dug myself out with a short sale. Here’s how the process works for you, as the soon-to-be-former homeowner.

Why would you need a short sale?

You might opt for a short sale if you can no longer afford your home (this was the case for me) or are underwater on your mortgage and need to move. Being underwater means you owe more on the home than it’s worth, and this might not be such a big deal if you are intending to keep living there.

In such an instance, your mortgage lender gets the final say over whether the short sale can happen. You would likely need to communicate in writing why the short sale is a good idea, and perhaps share why you can no longer afford your payments. The lender will have to agree to sell the home for less than you owe and take a loss on it, if it agrees to forgive the debt you’d still owe.

A short sale is a lot of hassle for a lender too, because it will have to oversee the sale by way of hiring a real estate agent. Short sales can be complicated; the National Association of Realtors noted that many of its members have limited experience with them, so if your lender recommends a certain agent, it’s likely best to go with the recommendation if they are interested in handling it. This isn’t to say you won’t be dealing with an agent, because you will.

You have to make your home appealing to buyers

Even if your lender is managing the sale of the home in partnership with a real estate agent, you should still be invested in making your home look its best to sell, as you can continue to live there during the process. I wasn’t even in the same state as my house during my short sale, but I still had to pay for the landscaping that was needed for curb appeal; that was several hundred dollars I could not afford then, but it’s a really important move to sell a home. (At this point, I wondered if that house would ever stop ruining my life.)

You’ll have to move — but you might get a seller incentive

When your home sells, you’ll have to move out, but you can generally live in it during the sales process (bearing in mind that it’s in your best interest to keep the home looking nice so it sells quickly and you can get on with your life).

You might get a seller incentive when the home is sold and the sale is complete. This will depend on the circumstances of your home loan and the particulars of your lender. I got an incentive check when I went through my short sale, but that was several years ago. And then I was able to qualify for a tax break on my incentive, which was a big help.

Your credit takes a hit

When all is said and done, you’ll end up with damage to your credit score. How much will depend on how many payments you missed before starting the short sale process. Regardless of whether you manage to get out from under your mortgage before you miss payments, the account will still show as “settled,” or “account legally paid in full for less than the full balance,” according to credit bureau Experian. And this does hurt your credit score (though less than a foreclosure, which has a very negative impact on it). But you won’t have the impact of missed payments on top of that.

Short sales don’t last forever on your credit. My FICO® Score rebounded to “good” (670-739) within a few years, and has only gotten better, taking me to the “exceptional” range (800-850) since I got my finances in order in 2022.

If I can go through this and come out on the other side, so can you. So if a short sale is in your future, or you’re struggling to make your mortgage payments and looking for a way out, you might consider this option, which is better than a foreclosure.

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Walmart has fun summer items that people of all ages will love. Check out four of them, including a water table, an electric scooter, and even a swimming pool. 

Summer can be an expensive time, with your checking account taking a hit as you try to find fun things to do during the long days when school is out.

The good news is, you can give your credit cards a rest and still have an awesome time if you check out these four affordable Walmart summer favorites.

There are items on this list that will please both adults and children alike, so see if any of them could be the perfect purchase to make your summer memorable.

1. A sand-and-water table that provides two activities in one

Ask any toddler and they’ll tell you that playing in the sand is fun. And so is playing in the water. That’s why the TEMI Sand Water Table for Toddlers is the perfect toy to provide endless hours of summer enjoyment.

The table can be filled with either water or sand and comes with sand tools and water toys so kids can enjoy both options. The toy’s price tag is $52.99 and has more than 550 reviews, with parent and grandparent reviewers describing it as easy to assemble, easy to clean, and roomy enough for multiple kids to play together. Some reviewers even said it helped their kids develop their fine motor skills.

2. An electric scooter

For those kids outside of the toddler years, an electric scooter will be a great incentive to get outdoors and off of screens. The Pulse Revolution Revster 200 costs just $33.15 and is designed for kids ages eight and over. With the included 12-volt battery, kids can ride for 70 minutes without a charge. And it can convert to a kick scooter once the power runs out, so your kids may even get some exercise as an added bonus.

The product received mostly positive reviews as well, with the limited complaints focused on the color and the fact that in a few cases, the product arrived damaged.

3. An inflatable swimming pool

For $55.99, adults and kids alike can enjoy some summer fun by splashing around in the SOFIA Inflatable swimming pool, which measures 120″ x 72″ x 23″, meaning it’ll fit the whole family.

The pool is constructed of thick PVC for durability and is lead-free, and BPA-free for safety. You can inflate it within three minutes using an electric pump (which is not included) and two drain plugs make drainage easy after you’ve enjoyed it for a few hours — so your HOA won’t complain about a pool in the yard.

Reviewers were mostly positive about this product as well, with some users describing it as holding up nicely and being a “breeze to inflate.”

4. A lawn water slide

The classic slip and slide has been given a big upgrade with the JOYIN 22.5ft water slide that comes with two body boards and sells for $42.99. The slide sets up in minutes after enrolling and securing the bumper, and you can connect a hose directly to it to keep the water flowing and the fun coming.

Safety stakes ensure the slide stays where you put it so your kids can enjoy sliding safely. And, adults may even decide to join in the fun due to its length. With 4.7 out of 5 stars, the slide was a big hit, with many reviewers commenting it was larger than expected and priced great.

Maybe a few of these items sound like they’ll enhance your summer fun. Just be sure to buy them with a cash back or rewards credit card, so you’ll have a little extra money coming back to you that you can use to treat everyone to ice cream on a hot summer day.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Christy Bieber has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Walmart. The Motley Fool has a disclosure policy.

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If a check goes missing, your personal information and bank account number are exposed. Keep reading to learn how check theft can impact you. 

Paper checks are going the way of the dodo, but that doesn’t mean you might not still have occasion to use one to pay for something. I still have some, and most recently used one to pay for my city’s on-street parking permit. In this instance, I wasn’t worried about the possibility of check fraud or loss, however, as I had to visit the parking bureau office and drop off the check in person. If I was mailing it, I might have been a bit more concerned, as you’ll understand if you read on.

Checks are far from being the most secure way to make purchases these days, and that potential for theft and subsequent fraud is one of the reasons why you might think twice about paying this way. Nevertheless, if you do still use checks regularly, it pays to take some care when you do. Why is that? Because having a check stolen is bad news all around.

When a check goes missing

It’s surprisingly easy for thieves to take your checks. If you leave outgoing mail in an unlocked mailbox at home, waiting on the mail carrier, thieves might beat them to it. Georgia State University’s Evidence-Based Cybersecurity Research Group (EBCS) has been tracking check fraud, noting an average of 1,325 stolen checks being sold on the internet every week of October 2021. Criminals involved in this enterprise have even been able to purchase stolen USPS blue mailbox keys (or copies of them) and then swipe piles of mail from the boxes, hoping to find envelopes containing personal checks.

They can then wash the checks to remove the intended recipient’s name and payment amount, and then fill in whatever they want — usually a higher dollar figure than the check was originally written for. When that check is cashed or deposited, the money comes out of your checking account, and you’re left wondering what happened.

Another thing to remember about checks as a payment method is that unlike a credit card, they have a lot more information about you on them. Not only can a thief gain access to your bank account and routing number, but your name and address are on your checks. EBCS also believes criminals are using stolen checks to steal victims’ identities and use names and addresses to create fake documents and identification, such as passports. If a thief steals your identity, they can open credit cards and take out loans in your name. Plus, having your name and location out there and accessible to criminals is hardly a comforting idea.

How can you protect yourself?

Check theft is a crime that has the potential to go extinct as more and more people stop using checks. A survey by GoBankingRates from earlier this year found that 45% of Americans didn’t use checks at all last year. But, like me, you might still have to write the occasional check. Here are a few things to be mindful of.

Be careful about mailing (and writing) checks

When you do, it’s best to drop it off in person or mail it directly from the post office, rather than leaving it in your mailbox at home, or dropping it in the blue mailbox in your neighborhood. If you’re writing checks, black gel ink is the best kind to foil potential check washers.

Watch your bank account

If you pay for something with a check, keep a careful eye on your bank account until the money is taken out — and if the amount is different from what you wrote the check for, get in touch with your bank to address the fraud. It’s a great idea to stay on top of your bank account balance at all times anyway, perhaps checking in a few times a week. This can also help you avoid accidentally overdrafting your bank account or bouncing a check.

While you’re at it, opt-in for fraud and low-balance alerts for your account in the form of text messages or emails, and don’t forget to get your bank’s mobile app to make your financial life so much easier.

Consider switching to more secure payment methods

Finally, consider using payment methods other than writing paper checks yourself. You have so many options. Many utility companies offer online bill pay through bank transfers, or they accept credit and debit cards (watch out for fees to pay with plastic, though). You can also have your bank send checks on your behalf for bill payments.

If you mail checks to relatives for special occasions, consider sending the cash through a payment app instead. These are very easy to use. If these relatives are teens and young adults, chances are they will find a payment app transfer a much more convenient way to receive a gift from you, their favorite family member.

If you’ve been using checks for decades, I understand your reluctance to switch to a new way to pay. But you can still use paper checks — it just pays to keep on top of your account balance and be cautious about where you mail checks from.

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Saving for a down payment on a house can be a challenge, but if your kids live with you to cut their costs, it may be easier. Check out what to consider. 

Since 2018, the typical home buyer has put down between 6% and 7% as a down payment when purchasing a home, according to the National Association of Realtors. The median sales price for a home was $436,800 as of the first quarter of 2023, per the Federal Reserve of St. Louis. This means the buyer of a typical home would put down around $30,576 to get a mortgage loan and get into a property.

Some buyers need much more than that, especially if they would prefer to put down 20% to avoid private mortgage insurance (which protects lenders and adds to the buyer’s cost). Buyers in high cost of living areas will also need a bigger sum. And saving even $30,000 can be a challenge for many, so even those who don’t need more money may struggle to get a property of their own.

If you are a parent whose kids are trying to purchase a property, one possible option to help is to allow them to move back in with you to save on rent or housing costs so they can set aside more cash in a savings account for a down payment. But is this a good idea? Before you decide, be sure to ask yourself a few key questions.

How long would your child need to live with you to save a down payment?

The first big thing to think about is how long your child might need to live with you in order to save the necessary down payment to buy a house. A short-term arrangement may not be a big deal, but if it would take years to save enough, it could be more of an imposition on you and your own goals for your senior years.

Talk with your child about how much money they need to put down, how much they could actually save each month if they moved in with you, and what the timeline would be for saving up a down payment and moving forward with making an offer on a home.

Would your child contribute anything to the household expenses?

If the goal is for your child to move in to save money for a house, that means obviously they would want to keep their expenses as low as possible. But adding someone new to your household can add costs for you in the form of things like higher grocery and utility bills.

Consider what contributions, if any, you would expect your child to make to household expenses. Think about how that money affects their timeline for moving into a home of their own. And be sure you’re on the same page on this issue so there’s no resentment and so your own pocketbook doesn’t take a huge hit in a way that interferes with goals you have for yourself.

What would the “rules” be for shared living?

FInally, consider what living together would actually look like. If your child is thinking about buying a home, they are probably an adult already — so would you be able to accept them living under your roof but not being subject to any restrictions?

By addressing these issues, you and your child can come together to make the best choice about whether cohabitating for a while to enable your child to buy a house of their own is a wise decision for your relationship — and for both of your finances.

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Next year, you’ll be able to put more money into your health savings account. Read on to learn why HSAs are a great place for your healthcare dollars. 

If you have a high-deductible health insurance plan, you may have heard of health savings accounts (HSAs). With a high-deductible plan (defined as one with a deductible of at least $1,600 for an individual or $3,200 for a family in 2024), you qualify to open one. An HSA is a special type of savings account that is designed to hold money put aside for qualifying medical expenses.

And unlike their similarly named brethren, flexible spending accounts (FSAs), HSAs actually are flexible. You get to decide how much to put in (up to the annual limit, which I’ll discuss below) and can roll your contributions over every year. And just in case you’re not completely sold on HSAs yet, wait, there’s more!

HSAs are triple tax advantaged, as the cash you fund them with reduces your taxable income for that year. Then the money grows tax free, and you won’t even pay taxes on it when you make withdrawals to cover qualified medical expenses. HSAs can even form another piece of your retirement puzzle because, depending on where you open the account, you might be able to invest the money.

If you’ve already got an HSA or will be transitioning to a high-deductible health insurance plan for 2024 and therefore opening one with a bank, there’s some good news. Contribution limits will be increasing. Here’s what you need to know.

2024 HSA contribution limits

A lot of Americans have struggled with inflation over the last year and change, but HSA limits are changing next year to keep up. For 2024, those with an individual health insurance plan and an HSA can contribute up to $4,150 to their account — an increase of about 8% from the $3,850 limit in 2023. If you’ve got a family plan, you can contribute $8,300, up about 7% from 2023’s limit of $7,750.

If you’re over 55, you can make catch-up contributions of $1,000 more. This means if you and your spouse (also over 55) have a plan together, your total contributions can be $10,300. It’s worth taking advantage of these increases, thanks to the tax and flexibility benefits I discussed above.

Make a plan now

How can you take advantage of this change? We’re only halfway through 2023, and you can’t make higher contributions to your HSA until 2024, but now is a great time to come up with a plan. If you can afford to contribute up to the limit for your account type, it’s definitely a good idea, because you’ll be able to let the money grow if you don’t use it for medical expenses. You’ll need to get in touch with your company’s human resources department to up the contributions from each of your paychecks in 2024. And if you’re not investing your HSA funds currently, check with the financial institution that holds your account to see if you’re allowed to, and what types of investments you’ll have access to.

An HSA can be a great way to optimize your healthcare spending, and being able to contribute more money to one next year can help you lower your taxable income and potentially help fund your retirement. What’s not to like?

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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