If you’re like me, you like to be organized, and when I used to try and collect money from my old roommates, it was a real mess if I was not tracking it.
If you only have one roommate, it will be easy, and you may not even need to use anything more than a calculator and a spreadsheet. Then just collect the money when the bills are paid at the end of the month.
If you have multiple roommates, you’ll want to try using an app because it will make things so much easier. Plus you will save lots of time.
Check out the below list of apps and tools to track and transfer money between you and your roommates.
Roommate money Apps/Tools for expense tracking and paying each other
Paypal – We all know about PayPal; it’s been around since 1998. Anybody with an e-mail address can sign-up and send or receive money directly from their checking account or credit card. The PayPal mobile app is pretty easy to use, and PayPal is a trusted company as far as security goes.
Venmo – Just like PayPal, you can also send and receive money to anyone with Venmo. This payment app is especially popular with college students. The best part is it’s free to use if you utilize your Venmo balance, bank account, or debit card to pay someone. Otherwise, the standard fee is 3%. Remember always to review the fine print to find out how much is being charged regarding merchant fees.
Splitwise – This is an exciting app that I recently discovered. It will track your expenses and IOUs (what everyone owes) with your friends and roommates. It allows you to split costs with everyone fairly. It can be very beneficial and convenient if you can convince everyone involved to install it and use it.
RentShare – This app will help track each roommate’s rental payments to your Landlord. You can even use your credit card to pay your share of the rent. While that might be a nice feature, I’d be a bit concerned if my roommates needed to pay their share of the rent with a credit card. One last thing about this app, you’re Landlord has to sign-up too for you to use it.
Additional Tips For Splitting The Bills With Roommates
Keep All Big Purchases Separate, But Share
If you need to buy a couch for the living room, it’s best to have one person buy it, own it, then share it. That way, at the end of the lease, one person owns it, and there’s no fighting as to how to split it.
In return for sharing your big item, such as a couch, your other roommates should purchase other big items to share, such as a love seat, BBQ, Dining Room Set, Television, etc.
Divide Up The Groceries And Other Food Costs
Sharing the food costs with roommates can be tricky because what if one of you eats more than the other?
You can solve this issue by being very selective about what types of food you share together. For example, don’t share your favorite cereal. But if you decide one night to cook an expensive dinner and it makes enough for more than one person, why not ask them to chip in and share it?
Chipping in money on Wine, Beer, and bulk items like toilet paper, steaks, chicken, and other frozen food packs you buy from Costco is also a great idea.
Never wait until the end of the month to collect money owed to you for shared food. Roommates have a horrible time remembering these types of IOUs vs. the monthly utility bills, which can be clearly pointed out.
Should all the roommates split the utilities and bills equally?
Usually, yes, if all things are created equal in the living space. But many times, they are not.
What if one of you works from home? That person should be paying more for the electricity bill because they are consuming more.
If you own a house and rent a spare bedroom, you should not expect your roommate, who rents just one bedroom, to pay 50% of the overall utilities. This is because they are taking up much less square footage in that house than you are. A fair estimate might be around 30% since they are most likely only using a third of the overall house.
The same attitude should be considered for all of the expenses relating to rent, utilities, and any other miscellaneous living expenses. Discuss with your roommates and figure out an arrangement that is fair for everyone.
What If Your Roommate Does Not Pay Their Share Of The Rent?
Having a roommate who does not pay their share of the rent is a terrible problem to deal with. It’s by far the worst type of roommate problem to have because their actions have a massive impact on you both.
The best thing to do in this situation is to exercise some patience and understanding! Then, try to help your roommate brainstorm some ways to get some quick cash with the following suggestions.
- Ask a family member for assistance. Mom, Dad, or a Sibling would be best.
- Sell some books or video games for extra cash. Or any other personal items that have value.
- Get a payday advance from work (I highly discourage this, but do what you gotta do).
- You might think about picking up the entire rent and collecting it from them at a later time. Especially if you’re both sharing a lease and you don’t want to ruin your credit. BE WARNED! You’ll have to collect it in court if they don’t pay you back! Or just kiss it off as a loss.
- Face the reality that your roommate can’t pay and you might need to speak with them and your landlord to get a new roommate who can. This might involve the old roommate breaking the lease or having someone new take it over.
As you gain experience living with roommates and sharing expenses with them, you’ll become much more confident asking them for the money that is owed to you. Of course, it won’t always go smoothly trying to collect money from people, but it won’t be a nightmare either if you are strong, organized, and don’t let others get one over on you.