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How to manage share house finances

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Share house arrangements are a brilliant way to get around issues caused by sky-high rents and property prices.

They can be a barrel of laughs, with a mate always down the hallway and the potential for a big night out with the flatmates on the weekend. But we know that they can also be an absolute nightmare if you don't handle your household finances in a suitable way. Fighting over money is the last thing you want to do with your housemates, so we've whipped up a quick guide to share house finances to help make sure that doesn't happen. From everyday banking to budgeting and insurance here are some things to help point you and your mates in the right direction.

  Set up a shared account
The first thing you could consider is setting up an everyday banking account with a debit card to access funds. This will be the account that the entire flat pays bills and rent into, making it easier to monitor who's paid what - and more importantly who hasn't paid1You may wish to nominate the flat's most trusted and reliable person to manage this account and keep a spreadsheet of all transactions in and out of it. That way if there's a dispute about money, all payments will be recorded in one easy to access document so that they can be quickly resolved2.
  Manage your budget and payments

After a month or so in your shared household, you'll probably have an idea of how much you need to cover for expenses every week. Things like rent, internet, phone and garden maintenance bills can be set up as automatic payments into the shared account so that you never miss a rent payment or bill.

Flatmates could decide to take charge of one variable cost like electricity, water and the buying of everyday household items (dishwashing liquid, washing powder, toilet paper) each3. That way each house mate will take their share of responsibility, sending reminders to the group including copies of bills and receipts when it's time to pay up. If each member is taking care of organising the payment of a particular utility or cost, then each member may need their own debit card to pay these bills.

Whoever uses their house account debit card should take special care to keep their receipts to avoid any disputes over money spent or owed4.

  Make the rules and communication clear

If your housemates aren't on the same page, you probably won't get far with household finances. Take the time to meet and discuss the plan as a group at the start of your tenancy.

Come up with a rough written plan of how your plan is going to work and agree as a group who will be in charge of the everyday account5. It's also important to make communicating with your group

as easy as possible so that you can quickly solve problems of chasing for payments if necessary. Something as simple as a Facebook Messenger or WhatsApp group chat with all members included is a great option.

  Insure your house contents
Depending on your needs, home contents insurance can be an essential piece in the puzzle of your share house finances6. Without it, you risk the actions of a flatmate costing the group thousands or more. IMB offers competitive contents insurance, and our friendly staff may have a policy option for your specific needs. We're a member-owned bank, so we've always got your best interests at heart and strive to offer competitive products and services. To make sure your flat-finances are air-tight, enquire about an Everyday Banking Account or Contents Insurance with IMB Bank today.

If it’s your first time moving out of home checkout this 30 sec video from MoneySmart:

 

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Source:

1 GoCompare.com, Finances of house sharing

2 FlatWithMe.com.au, 10 Tips For Managing Share House Expenses

3 GoCompare.com, Finances of house sharing

4 Youth Central, 5 tips for living in a share house

5 GoCompare.com, Finances of house sharing

6 GoCompare.com, Finances of house sharing

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IMB has a growing branch network throughout the Illawarra, Sydney, NSW South Coast, the ACT and Melbourne. We have a lending specialist in every branch and a team of mobile lending specialists who will come to you. IMB members enjoy access to free automated phone and internet banking and a team of professionals who are just a phone call away at our locally based call centre.

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