“For better or worse, for richer or poorer” may be a common wedding vow but it’s a vow most flatmates would be unwilling to take. When people share a household with flatmates, they expect each person to pay the rent and any other expenses on time each week or month. It’s the most important ingredient that people look for when searching for their perfect flatmate.
Whether you live with one flatmate in an apartment or share a large house with a group of flatmates, your household can gain control over and manage expenses successfully. It starts the minute your household begins conducting interviews and continues right through to the creation of guidelines for handling expenses.
So, how can your share house gain control over finances? Here are 10 tips that can help you and your flatmates manage expenses more easily.
1. Create A Household Budget
A budget lets your household calculate how much money it needs or can afford to spend each week or month. It lets you know in which areas spending is out of control or not enough money is allocated.
2. Set Up A Record Keeping System and Nominate A Bookkeeper
Creating an accounting system lets your share house keep track of the collection and payment of expenses. It lets you calculate how much money was spent each week or month and helps solve any disputes within your household or with billers. Take a look at our article about managing expenses for how you can set up your own record keeping system.
3. Always Give and Ask For Receipts
Collecting and giving receipts lets your bookkeeper create a paper trail that shows when expenses and bills have been paid. These receipts can be used as evidence if there are any disputes.
4. Collecting Expenses
You and your flatmates should decide when, where and how expenses should be collected and paid. For example, your household may decide to collect expenses each Friday at 4.00pm in cash and pay each biller on the last Friday of the month. Making a timetable makes it easier to collect payments and harder for money to be misplaced.
5. Make A Plan For Handling Disputes
Implementing a system for dealing with financial disputes can improve communication and reduce tension between flatmates. It lets your household solve any financial issues immediately before they become out of hand. Our step by step guide can help you solve any financial disputes.
6. Keep A Financial Diary
A diary lets your household’s bookkeeper record and keep track of any changes to the payment of bills like rent increases, new billing arrangements and additional expenses. You should also record the payment/reimbursement of bonds and the details of any disputes over money.
7. Flatmate Interviews
When interviewing for new flatmates, it’s important to find out about each person’s history of paying expenses and their attitude towards money. Interviews also let you outline the expenses that will need to be paid each week or month. These questionnaires may help you ask the tough questions during interviews.
8. Check References
Talking to people who have lived with your chosen flatmate lets you find out if they have paid their expenses on time each week or month. You can compare these answers with the ones your chosen flatmate has given during their interview and decide if they are the right flatmate for you. To learn more, take a look at our reference checking article.
9. Expenses and New Flatmate Households
Before moving in together, flatmates should work out how expenses will be paid in their new household. This includes sorting out which expenses will be paid separately and those that will be paid as a group. Talking about finances before moving in lets flatmates solve any issues without financial consequences.
10. Share House Rules
Any guidelines that have been created for finances should be included in the household rules. It helps remind flatmates how important keeping track of finances and paying expenses on time is to the smooth running of your share house.
By implementing these 10 simple tips your household can gain control over finances, manage any disputes and pay the bills on time. It’s just a matter of putting together a system that works for you and your flatmates. Most of all, it lets you leave the vow of “for better or worse, for richer or poorer” to one of most important days of your life, your wedding day.