how to split expenses as a couple

How to Split Expenses As a Couple.

Splitting expenses as a couple is an important aspect of having a stable relationship, especially if you’re living together. There are several ways to split expenses. One way is to split everything right down the middle, so each person pays half. The other way is for each person to pay for what they can afford. The final way is for one person to pay all or most of the expenses. If one of you works little or not at all, that person should make up the difference by contributing energy toward domestic tasks. Finally, ensure you’re covering yourself by keeping separate bank accounts and not cosigning loans with your partner.



Method 1 Choosing the Right Method.

1. Determine what expenses qualify as shared. Sometimes it is easy to identify a shared expense. For instance, heating, water, and electricity are house-wide expenses and you will both, presumably, enjoy their use in approximately equal amounts. But it might be harder to justify sharing other expenses. If you have TV service at your home, for instance, but only one of you watches TV, it makes little sense to split that particular expense.

Talk to your partner about which expenditures they believe should be considered shared and which should be considered individual expenses.

2. Split expenses evenly. By splitting every expense evenly, you and your partner have a form of equality in the relationship. This is probably the most logical way to split expenses for couples who have equal or roughly equal incomes.

There are many ways to split expenses 50/50. You might choose to split each expense as it comes in. Alternately, you might reconcile receipts at the end of each month and pay your partner whatever is “owed.” Talk to your partner about which method works best for you.

You don’t need to split everything perfectly evenly. Creating a spreadsheet to track expenses, or otherwise accounting for every penny spent between you can reduce your relationship to a purely economic exchange that takes the romance out of it. Even if you split household bills, it’s still okay to treat your significant other to dinner or a date when you go out.

For instance, you might take turns paying for dinner. Even if your dinners don’t total the exact same amount each time you go out to eat, over time, you’ll each probably end paying about the same amount. This qualifies as a form of splitting costs evenly.

3. Split your expenses according to income. This expense-splitting technique calls for the person with the higher income paying for a larger share of the household expenses. In other words, equality is achieved through each person in the relationship paying expenses according to their ability.

For example, suppose you earn $3,000 per month and your partner earns $2,000 each month. In this case, you should pay for 60% of the expenses, since your income is 60% of the total household income (the figure you get when you combine the incomes of you and your partner).

Talk carefully with your partner to make sure that there are no hidden issues before going forward with this method. In some cases, your partner may feel as though they are contributing too much or too little if this method is used.

4. Share expenses unevenly. In this method, one person will pay for the majority of household expenses. This is the natural choice to make when one person in the relationship has way more income than the other person. However, if both you and your partner make a lot of money, either of you could choose to take on an expense-splitting arrangement like this.

A fair arrangement doesn’t necessarily need to divide all expenses perfectly. For instance, one of you could take the internet bill while the other takes the power bill. Divide things up according to whichever scheme suits your situation.

5. Be willing to trade time and money. If you work and your partner doesn’t or if your partner works but you do not, there are other ways you can come to a fair arrangement by thinking about the work (as well as the money) it takes to run a household. Domestic work – cleaning, cooking, and doing the laundry – is crucial to keeping a household going. It makes little sense for one person to both complete all these tasks and also provide financial stability for you as a couple.

Think about splitting the total amount of work that each of you do as a couple rather than thinking of splitting expenses along purely financial lines.



Method 2 Splitting Food Expenses.

1. Figure out your food budget. Your food budget is the total you spend on food over a given period. To get an accurate picture of how much you spend on food, track your expenses over a certain period of time. Tracking over a month is a good unit of time, since depending on how much you and your partner eat, you might not spend much on food.

Use a shared spreadsheet in Google Doc or another program to track your expenditures. Your document should indicate each item you bought and how much it cost.

Alternatively, try a low-tech route like writing your grocery and dining-out expenses on a piece of lined paper.

Keep your receipts while tracking your food budget.

2. Analyze the budget. Once you’ve figured out your food budget, evaluate the information with your partner. Are you spending too much, too little, or just the right amount? Look for areas where you can cut expenses.

For instance, instead of spending so much on junk food and snacks, try to find healthy alternatives like fruit or veggies and hummus.

Instead of eating out so much, try eating at home more often. Make cooking together a couple's activity.

Eliminate or reduce your alcohol consumption for more savings.

3. Decide how to split the food expenditures. You can use an income-based method to choose how to split the food expenses, or split the food expenses according to consumption patterns. Whatever method you choose, ensure you and your partner agree on how much money you should be spending on food, and ensure you both set aside money each month for your grocery budget.

Let go of small differences in food consumption. Even if your partner eats more than you, constantly analyzing how much money each person owes for food can put a strain on the relationship.



Method 3 Being Smart About Shared Finances.

1. Plan for emergencies. Both you and your partner should have money saved in the event that one or both of you needs to pay for surgery, a new vehicle, or another large expense. Try to set aside at least 25% of your monthly income for savings.

You should have at least six months’ worth of income saved to cover periods of potential unemployment.

Be sure to set beneficiaries on your retirement and insurance plans, too.

If you separate from your partner, don’t forget to change your beneficiary list.

2. Have regular financial checkups. Every month or two, you and your partner should have a conversation about where you’re both at financially. Are you still both increasing your savings? Do you have enough saved to cover an emergency? Are you both still comfortable with the way expenses are being shared? Talk to your partner about these and other related issues.

Make budgeting and financial planning an activity you do together. This can be more successful or even exciting if you are both working towards a common goal, such as a vacation or purchasing a home.

Always be honest about your finances. If you are struggling financially, you should admit to your partner that you’re having money problems. That way they can help you out by either loaning you money, helping you find another job, or taking other action that can help.

Encourage your partner to be honest with you about their spending habits and their happiness with your current financial arrangement. If your partner lies about money matters, you should seriously consider ending the relationship.

Don’t let your partner push you into a purchase you can’t really afford. For instance, if you can’t afford a new car but your partner really wants you to have one, stand firm and insist that you will not make such a purchase. If they love you, they will respect your decision.

3. Do not move in with your significant other for financial reasons. Living with someone else and sharing expenses does save money, but if you make the decision to shack up based on the potential economic benefit, your relationship will be on an unstable foundation. Only move in together if you’re truly in love with the person and ready to be in close proximity to them night and day. This will make splitting finances just one part of your relationship, and not its entire basis.

4. Avoid borrowing money. Not only is it annoying for your partner, but it might make them suspicious of your financial health and question your intentions. It’s okay to borrow money in an emergency situation, but don’t make a regular habit of it.

If your partner regularly asks to borrow money, you should inquire as to why they constantly need money. They may have lost their job or have unpaid debts you don’t know about.

5. Avoid sharing debts. Cosigning a loan for your partner is never a good idea. The last thing you want to do is end up saddled with debt that you did not personally incur. Only make a large investment with your partner like a house or car if you are in a stable, long-term relationship.

You should ask your partner about any debts or liabilities that they may hold. Be honest about your own debt as well. Keeping these secret can ruin a relationship when the debt is discovered by the other partner.

Always put both your names on the lease, mortgage, or loan. This will allow you some degree of protection in the event you and your partner separate.

For mortgages, consult a real-estate attorney to help you figure out the best way to negotiate your local real estate laws as they relate to your relationship. A married couple has different options for taking out a home loan than an unmarried couple.

For auto loans, too, you (and your partner) should talk to a financial officer at your local bank or credit union. There are many variables that could impact whether you and your partner decide to take out an individual loan or cosign the loan. Seek advice relevant to your living situation in order to get the lowest interest rates and avoid shared debt.

6. Do not share assets. Assets are valuable possessions or investments. Common assets include bank accounts as well as big-ticket items. Typical material assets include houses, cars, and boats. These items should never be purchased using both your names. Otherwise, you might end up wrangling over ownership in the event you separate.

Bank accounts, likewise, should never be shared between you and your partner. These accounts can be a source of tension should one partner decide to use the money for themselves.

If you want to set up a shared account with your partner – for instance, an account either of you can use to pay bills – keep it completely separate from your personal account. Put a small amount of money in it each month along with your partner, and use it only to pay the bills you intended it for.

February 25, 2020

How to Split Expenses As a Couple.

How to Split Expenses As a Couple.

Splitting expenses as a couple is an important aspect of having a stable relationship, especially if you’re living together. There are several ways to split expenses. One way is to split everything right down the middle, so each person pays half. The other way is for each person to pay for what they can afford. The final way is for one person to pay all or most of the expenses. If one of you works little or not at all, that person should make up the difference by contributing energy toward domestic tasks. Finally, ensure you’re covering yourself by keeping separate bank accounts and not cosigning loans with your partner.



Method 1 Choosing the Right Method.

1. Determine what expenses qualify as shared. Sometimes it is easy to identify a shared expense. For instance, heating, water, and electricity are house-wide expenses and you will both, presumably, enjoy their use in approximately equal amounts. But it might be harder to justify sharing other expenses. If you have TV service at your home, for instance, but only one of you watches TV, it makes little sense to split that particular expense.

Talk to your partner about which expenditures they believe should be considered shared and which should be considered individual expenses.

2. Split expenses evenly. By splitting every expense evenly, you and your partner have a form of equality in the relationship. This is probably the most logical way to split expenses for couples who have equal or roughly equal incomes.

There are many ways to split expenses 50/50. You might choose to split each expense as it comes in. Alternately, you might reconcile receipts at the end of each month and pay your partner whatever is “owed.” Talk to your partner about which method works best for you.

You don’t need to split everything perfectly evenly. Creating a spreadsheet to track expenses, or otherwise accounting for every penny spent between you can reduce your relationship to a purely economic exchange that takes the romance out of it. Even if you split household bills, it’s still okay to treat your significant other to dinner or a date when you go out.

For instance, you might take turns paying for dinner. Even if your dinners don’t total the exact same amount each time you go out to eat, over time, you’ll each probably end paying about the same amount. This qualifies as a form of splitting costs evenly.

3. Split your expenses according to income. This expense-splitting technique calls for the person with the higher income paying for a larger share of the household expenses. In other words, equality is achieved through each person in the relationship paying expenses according to their ability.

For example, suppose you earn $3,000 per month and your partner earns $2,000 each month. In this case, you should pay for 60% of the expenses, since your income is 60% of the total household income (the figure you get when you combine the incomes of you and your partner).

Talk carefully with your partner to make sure that there are no hidden issues before going forward with this method. In some cases, your partner may feel as though they are contributing too much or too little if this method is used.

4. Share expenses unevenly. In this method, one person will pay for the majority of household expenses. This is the natural choice to make when one person in the relationship has way more income than the other person. However, if both you and your partner make a lot of money, either of you could choose to take on an expense-splitting arrangement like this.

A fair arrangement doesn’t necessarily need to divide all expenses perfectly. For instance, one of you could take the internet bill while the other takes the power bill. Divide things up according to whichever scheme suits your situation.

5. Be willing to trade time and money. If you work and your partner doesn’t or if your partner works but you do not, there are other ways you can come to a fair arrangement by thinking about the work (as well as the money) it takes to run a household. Domestic work – cleaning, cooking, and doing the laundry – is crucial to keeping a household going. It makes little sense for one person to both complete all these tasks and also provide financial stability for you as a couple.

Think about splitting the total amount of work that each of you do as a couple rather than thinking of splitting expenses along purely financial lines.



Method 2 Splitting Food Expenses.

1. Figure out your food budget. Your food budget is the total you spend on food over a given period. To get an accurate picture of how much you spend on food, track your expenses over a certain period of time. Tracking over a month is a good unit of time, since depending on how much you and your partner eat, you might not spend much on food.

Use a shared spreadsheet in Google Doc or another program to track your expenditures. Your document should indicate each item you bought and how much it cost.

Alternatively, try a low-tech route like writing your grocery and dining-out expenses on a piece of lined paper.

Keep your receipts while tracking your food budget.

2. Analyze the budget. Once you’ve figured out your food budget, evaluate the information with your partner. Are you spending too much, too little, or just the right amount? Look for areas where you can cut expenses.

For instance, instead of spending so much on junk food and snacks, try to find healthy alternatives like fruit or veggies and hummus.

Instead of eating out so much, try eating at home more often. Make cooking together a couple's activity.

Eliminate or reduce your alcohol consumption for more savings.

3. Decide how to split the food expenditures. You can use an income-based method to choose how to split the food expenses, or split the food expenses according to consumption patterns. Whatever method you choose, ensure you and your partner agree on how much money you should be spending on food, and ensure you both set aside money each month for your grocery budget.

Let go of small differences in food consumption. Even if your partner eats more than you, constantly analyzing how much money each person owes for food can put a strain on the relationship.



Method 3 Being Smart About Shared Finances.

1. Plan for emergencies. Both you and your partner should have money saved in the event that one or both of you needs to pay for surgery, a new vehicle, or another large expense. Try to set aside at least 25% of your monthly income for savings.

You should have at least six months’ worth of income saved to cover periods of potential unemployment.

Be sure to set beneficiaries on your retirement and insurance plans, too.

If you separate from your partner, don’t forget to change your beneficiary list.

2. Have regular financial checkups. Every month or two, you and your partner should have a conversation about where you’re both at financially. Are you still both increasing your savings? Do you have enough saved to cover an emergency? Are you both still comfortable with the way expenses are being shared? Talk to your partner about these and other related issues.

Make budgeting and financial planning an activity you do together. This can be more successful or even exciting if you are both working towards a common goal, such as a vacation or purchasing a home.

Always be honest about your finances. If you are struggling financially, you should admit to your partner that you’re having money problems. That way they can help you out by either loaning you money, helping you find another job, or taking other action that can help.

Encourage your partner to be honest with you about their spending habits and their happiness with your current financial arrangement. If your partner lies about money matters, you should seriously consider ending the relationship.

Don’t let your partner push you into a purchase you can’t really afford. For instance, if you can’t afford a new car but your partner really wants you to have one, stand firm and insist that you will not make such a purchase. If they love you, they will respect your decision.

3. Do not move in with your significant other for financial reasons. Living with someone else and sharing expenses does save money, but if you make the decision to shack up based on the potential economic benefit, your relationship will be on an unstable foundation. Only move in together if you’re truly in love with the person and ready to be in close proximity to them night and day. This will make splitting finances just one part of your relationship, and not its entire basis.

4. Avoid borrowing money. Not only is it annoying for your partner, but it might make them suspicious of your financial health and question your intentions. It’s okay to borrow money in an emergency situation, but don’t make a regular habit of it.

If your partner regularly asks to borrow money, you should inquire as to why they constantly need money. They may have lost their job or have unpaid debts you don’t know about.

5. Avoid sharing debts. Cosigning a loan for your partner is never a good idea. The last thing you want to do is end up saddled with debt that you did not personally incur. Only make a large investment with your partner like a house or car if you are in a stable, long-term relationship.

You should ask your partner about any debts or liabilities that they may hold. Be honest about your own debt as well. Keeping these secret can ruin a relationship when the debt is discovered by the other partner.

Always put both your names on the lease, mortgage, or loan. This will allow you some degree of protection in the event you and your partner separate.

For mortgages, consult a real-estate attorney to help you figure out the best way to negotiate your local real estate laws as they relate to your relationship. A married couple has different options for taking out a home loan than an unmarried couple.

For auto loans, too, you (and your partner) should talk to a financial officer at your local bank or credit union. There are many variables that could impact whether you and your partner decide to take out an individual loan or cosign the loan. Seek advice relevant to your living situation in order to get the lowest interest rates and avoid shared debt.

6. Do not share assets. Assets are valuable possessions or investments. Common assets include bank accounts as well as big-ticket items. Typical material assets include houses, cars, and boats. These items should never be purchased using both your names. Otherwise, you might end up wrangling over ownership in the event you separate.

Bank accounts, likewise, should never be shared between you and your partner. These accounts can be a source of tension should one partner decide to use the money for themselves.

If you want to set up a shared account with your partner – for instance, an account either of you can use to pay bills – keep it completely separate from your personal account. Put a small amount of money in it each month along with your partner, and use it only to pay the bills you intended it for.

February 25, 2020

How to Manage Family Finances

How to Manage Family Finances.

To live a happy and peaceful life with financial freedom, it's very important to manage family finances properly. Failing to manage spending or agree on financial decisions can cause a married couple to fall into endless arguing. To get through the many financial decisions present in married life, you have to coordinate a budget and financial planning with the whole family and keep an open dialogue going about the family's money.

Part 1 Coordinating Family Finances.

1. Talk openly about your finances. While this is important all the way through life, it is especially important to establish financial honestly before you get married. If one partner has a poor credit history or large debts that are not brought up before marriage, it can lead to resentment and problems down the road. Before getting married, you should meet with your loved one and discuss his current financial situation, including how much he makes, where that money goes, his credit history, and any large debts he is carrying. This sets the tone for financial openness in the rest of your lives together.

2. Meet regularly to talk about money. Decide on a time of the month to get together specifically to discuss your finances. Perhaps this meeting can coincide with the arrival of the monthly bank statement or the due date of monthly bills. In any case, use your time at this meeting to assess the previous month's expenditures, mark your progress towards long-term goals, and to propose any changes or major purchases that you want to make. Only by talking about money regularly can you make doing so a comfortable and productive experience.

3. Don't make one person the sole manager of the family's money. Many families choose to allow one person to take charge of all the family's finances; however, this places an unnecessary burden on that person and leads to others' being unaware of the family's current financial situation. In addition, if that person leaves through death or divorce, it leaves the others completely unaware of how to manage or even access the family's finances. Solve this problem by splitting up tasks between you or by managing finances in alternating months.

Both you and your spouse should attend any meetings with financial professionals, such as those with a loan officer or investment advisor.

4. Decide on an account setup. Families have options when it comes to setting up joint accounts. Some choose to keep everything together while others keep their finances mostly separate. At minimum, you should have a joint account to pay for household expenses and your mortgage payment. At the end of the month, you can split these expenses in half and each transfer in an equal amount of money into this account to pay these expenses. Having separate account can prevent arguments that might arise from one person's spending habits.

Just make sure to set limits to how much money each of you can spend each month so that one person doesn't end up spending all of the family's money.

5. Build up individual credit. Even though your finances will be combined, it is still important for each of you to have a strong credit score. Doing so will ensure not only that your credit will be good when you apply for credit jointly, but also that your credit history will remain intact if you split up. A simple way to manage this is by having separate credit cards, each established only in the name of the spouse who uses it.

Part 2 Using a Budget.

1. Choose a budget format. Before you create a budget, you'll have to decide how to keep that budget. While many people can get away with just using a notepad and pen, others find it easier to track their spending through a spreadsheet or financial software. There are a number of a free software platforms available online that you can use to establish and track a budget. For example, programs like Mint.com and Manilla offer free budgeting services. If you want full service financial software, try Quicken or Microsoft Money.

2. Assess your current spending habits. For a month, write down a note every time you spend money, even for very small amounts. Record the amount spent and what it was you paid for. At the end of the month, sit down with your spouse and total up both your spending. Add in major expenditures to get a clear picture of where the family's money went that month. Split up expenses by category (home, car, food, etc.) if you can. Then, compare that amount to your combined, after-tax income. This is your starting point for determining a budget.

It may also be helpful to work with your bank statement to make sure you didn't miss any recurring payments or online purchases when totaling your expenses.

3. Come together to create a budget. Look at your compiled spending habits. Do you have a surplus? Or are you spending more than you make? Work from here to identify areas where you can cut back, if needed. If at all possible, try to free up money that can be put into savings or into the retirement fund. Create spending limits on certain categories, like food and entertainment, and try to stick to them over time.

Remember to always leave room in your monthly budget for unexpected expenses, like small medical bills or car repairs.

4. Work to improve and change your budget as needed. Return to your budget regularly to eliminate unnecessary spending or to adjust your budgeted amounts as needed. For example, having a child may cause you to have to completely restructure your budget. In any case, constantly seek out areas where you can cut back and save more. You'll find that you can be just as happy while spending much less than you do now.

Part 3 Saving for Life Goals.

1. Decide on long-term goals together. Have an open conversation about your savings goals, including saving for a house, for retirement, and for other large purchases like a car or boat. Make sure that you both agree that the purchase or expense in question is worth saving for and that you agree on the amount needed. This will help coordinate your savings and investment efforts.

2. Create an emergency fund. Every family should strive to keep an emergency savings fund for when things go south. Who knows when one of you might lose a job or experience unexpected medical problems? An emergency fund can help you avoid future debt and provide some financial security and flexibility. The traditional wisdom is to keep three to six month's salary in a savings account; however, this would be more than enough for some families and not nearly enough for others. Luckily, there are several financial calculators online that you can use to calculate roughly how much you need to save to cover your expenses.

Try searching for emergency fund calculators using a search engine.

There is also an app, HelloWallet, that offers this type of calculator.

3. Reduce your debt. Your first goal should be to pay off your existing debt. Only by paying down student loans, car loans, and other debt can you qualify for more credit as a couple and move forward with saving for other goals. To eliminate debt, work together to pay more than the minimum payment on each loan (as long as there are no prepayment penalties for doing so). Work with your spouse to create a plan and schedule for paying off your outstanding debt. If necessary, have one of you in charge of making sure that debt payments have been made each month.

4. Save for retirement. Couples should start planning for retirement as early as possible. This is because, due to the effects of compound interest, money placed in a retirement fund at a young age will earn much more interest over its life than the same amount of money put in at a later age. Make sure to make every effort to increase your retirement savings, including seeking to max out your employer's 401(k) match (if they have one), maxing out IRS-limits for 401(k) savings, and regularly increasing your retirement savings amounts if you can fit it into the budget.

You should save for retirement before putting money into education funds for your children. This is because there will always be scholarships and grants available for education, but not for your retirement.

If you don't have a combined retirement portfolio, be sure to coordinate your risk profiles and asset allocations.

5. Plan for educational expenses. If you're planning to fund part or all your child's higher education, it's best to start saving early on. Start by investigating options like 529 savings plans, which have special tax benefits for students. Speak with a financial advisor to learn more and get started saving today. If you don't have much time before your child leaves for school, look into government loans and grants, as well as your option in earning federal student aid.

Part 4 Staying on Track.

1. Don't make large purchases without discussing them first. Establish a monetary limit for what constitutes a "major" purchase. Obviously, this will differ between families, but the important thing is that you have a set limit. For any purchases above this limit, decide that the spouse making the purchase must have the approval of the other before going through with it. If either of you ever breaks this rule, be sure to tell the other immediately. Keeping large expenditures private is just asking for trouble.

2. Avoid taking on unnecessary debt. Keep each other on track by avoiding taking on debt for medium-sized purchases like furniture or jewelry. Plan these purchases out beforehand with your spouse so that you can combine your resources and afford the full amount of the purchase. This will save you money on interest payments in the long term. In addition, always check in with each other about credit card debt. It may be in your best interest to help a spouse with her credit card payment if she can't make it; missing a monthly payment will hurt your combined credit, which you will need if you apply for a large loan like a mortgage.

3. Use software to monitor your finances. With all of the budgeting and financial planning software available today, you'd be a fool not to take advantage of these useful tools. For starters, try tracking your monthly budget in a shared spreadsheet like those available in Google Drive. This type of document allows both of you to access and change the sheet as needed. For budgeting, there is are apps available like HomeBudget or Mint, which summarize the family budget and assets into a simple user interface.

There are also apps for keeping track of financial paperwork, like FileThis.

Try a few of these apps out and decide which ones work for you. Most of them are free or inexpensive to use, or at least offer a trial period.

December 17, 2019

how to manage family finances

How to Manage Family Finances.

To live a happy and peaceful life with financial freedom, it's very important to manage family finances properly. Failing to manage spending or agree on financial decisions can cause a married couple to fall into endless arguing. To get through the many financial decisions present in married life, you have to coordinate a budget and financial planning with the whole family and keep an open dialogue going about the family's money.

Part 1 Coordinating Family Finances.

1. Talk openly about your finances. While this is important all the way through life, it is especially important to establish financial honestly before you get married. If one partner has a poor credit history or large debts that are not brought up before marriage, it can lead to resentment and problems down the road. Before getting married, you should meet with your loved one and discuss his current financial situation, including how much he makes, where that money goes, his credit history, and any large debts he is carrying. This sets the tone for financial openness in the rest of your lives together.

2. Meet regularly to talk about money. Decide on a time of the month to get together specifically to discuss your finances. Perhaps this meeting can coincide with the arrival of the monthly bank statement or the due date of monthly bills. In any case, use your time at this meeting to assess the previous month's expenditures, mark your progress towards long-term goals, and to propose any changes or major purchases that you want to make. Only by talking about money regularly can you make doing so a comfortable and productive experience.

3. Don't make one person the sole manager of the family's money. Many families choose to allow one person to take charge of all the family's finances; however, this places an unnecessary burden on that person and leads to others' being unaware of the family's current financial situation. In addition, if that person leaves through death or divorce, it leaves the others completely unaware of how to manage or even access the family's finances. Solve this problem by splitting up tasks between you or by managing finances in alternating months.

Both you and your spouse should attend any meetings with financial professionals, such as those with a loan officer or investment advisor.

4. Decide on an account setup. Families have options when it comes to setting up joint accounts. Some choose to keep everything together while others keep their finances mostly separate. At minimum, you should have a joint account to pay for household expenses and your mortgage payment. At the end of the month, you can split these expenses in half and each transfer in an equal amount of money into this account to pay these expenses. Having separate account can prevent arguments that might arise from one person's spending habits.

Just make sure to set limits to how much money each of you can spend each month so that one person doesn't end up spending all of the family's money.

5. Build up individual credit. Even though your finances will be combined, it is still important for each of you to have a strong credit score. Doing so will ensure not only that your credit will be good when you apply for credit jointly, but also that your credit history will remain intact if you split up. A simple way to manage this is by having separate credit cards, each established only in the name of the spouse who uses it.

Part 2 Using a Budget.

1. Choose a budget format. Before you create a budget, you'll have to decide how to keep that budget. While many people can get away with just using a notepad and pen, others find it easier to track their spending through a spreadsheet or financial software. There are a number of a free software platforms available online that you can use to establish and track a budget. For example, programs like Mint.com and Manilla offer free budgeting services. If you want full service financial software, try Quicken or Microsoft Money.

2. Assess your current spending habits. For a month, write down a note every time you spend money, even for very small amounts. Record the amount spent and what it was you paid for. At the end of the month, sit down with your spouse and total up both your spending. Add in major expenditures to get a clear picture of where the family's money went that month. Split up expenses by category (home, car, food, etc.) if you can. Then, compare that amount to your combined, after-tax income. This is your starting point for determining a budget.

It may also be helpful to work with your bank statement to make sure you didn't miss any recurring payments or online purchases when totaling your expenses.

3. Come together to create a budget. Look at your compiled spending habits. Do you have a surplus? Or are you spending more than you make? Work from here to identify areas where you can cut back, if needed. If at all possible, try to free up money that can be put into savings or into the retirement fund. Create spending limits on certain categories, like food and entertainment, and try to stick to them over time.

Remember to always leave room in your monthly budget for unexpected expenses, like small medical bills or car repairs.

4. Work to improve and change your budget as needed. Return to your budget regularly to eliminate unnecessary spending or to adjust your budgeted amounts as needed. For example, having a child may cause you to have to completely restructure your budget. In any case, constantly seek out areas where you can cut back and save more. You'll find that you can be just as happy while spending much less than you do now.

Part 3 Saving for Life Goals.

1. Decide on long-term goals together. Have an open conversation about your savings goals, including saving for a house, for retirement, and for other large purchases like a car or boat. Make sure that you both agree that the purchase or expense in question is worth saving for and that you agree on the amount needed. This will help coordinate your savings and investment efforts.

2. Create an emergency fund. Every family should strive to keep an emergency savings fund for when things go south. Who knows when one of you might lose a job or experience unexpected medical problems? An emergency fund can help you avoid future debt and provide some financial security and flexibility. The traditional wisdom is to keep three to six month's salary in a savings account; however, this would be more than enough for some families and not nearly enough for others. Luckily, there are several financial calculators online that you can use to calculate roughly how much you need to save to cover your expenses.

Try searching for emergency fund calculators using a search engine.

There is also an app, HelloWallet, that offers this type of calculator.

3. Reduce your debt. Your first goal should be to pay off your existing debt. Only by paying down student loans, car loans, and other debt can you qualify for more credit as a couple and move forward with saving for other goals. To eliminate debt, work together to pay more than the minimum payment on each loan (as long as there are no prepayment penalties for doing so). Work with your spouse to create a plan and schedule for paying off your outstanding debt. If necessary, have one of you in charge of making sure that debt payments have been made each month.

4. Save for retirement. Couples should start planning for retirement as early as possible. This is because, due to the effects of compound interest, money placed in a retirement fund at a young age will earn much more interest over its life than the same amount of money put in at a later age. Make sure to make every effort to increase your retirement savings, including seeking to max out your employer's 401(k) match (if they have one), maxing out IRS-limits for 401(k) savings, and regularly increasing your retirement savings amounts if you can fit it into the budget.

You should save for retirement before putting money into education funds for your children. This is because there will always be scholarships and grants available for education, but not for your retirement.

If you don't have a combined retirement portfolio, be sure to coordinate your risk profiles and asset allocations.

5. Plan for educational expenses. If you're planning to fund part or all your child's higher education, it's best to start saving early on. Start by investigating options like 529 savings plans, which have special tax benefits for students. Speak with a financial advisor to learn more and get started saving today. If you don't have much time before your child leaves for school, look into government loans and grants, as well as your option in earning federal student aid.

Part 4 Staying on Track.

1. Don't make large purchases without discussing them first. Establish a monetary limit for what constitutes a "major" purchase. Obviously, this will differ between families, but the important thing is that you have a set limit. For any purchases above this limit, decide that the spouse making the purchase must have the approval of the other before going through with it. If either of you ever breaks this rule, be sure to tell the other immediately. Keeping large expenditures private is just asking for trouble.

2. Avoid taking on unnecessary debt. Keep each other on track by avoiding taking on debt for medium-sized purchases like furniture or jewelry. Plan these purchases out beforehand with your spouse so that you can combine your resources and afford the full amount of the purchase. This will save you money on interest payments in the long term. In addition, always check in with each other about credit card debt. It may be in your best interest to help a spouse with her credit card payment if she can't make it; missing a monthly payment will hurt your combined credit, which you will need if you apply for a large loan like a mortgage.

3. Use software to monitor your finances. With all of the budgeting and financial planning software available today, you'd be a fool not to take advantage of these useful tools. For starters, try tracking your monthly budget in a shared spreadsheet like those available in Google Drive. This type of document allows both of you to access and change the sheet as needed. For budgeting, there is are apps available like HomeBudget or Mint, which summarize the family budget and assets into a simple user interface.

There are also apps for keeping track of financial paperwork, like FileThis.

Try a few of these apps out and decide which ones work for you. Most of them are free or inexpensive to use, or at least offer a trial period.

December 17, 2019

How to Set up a Fundraising Event

How to Set up a Fundraising Event.

Whether you want to get involved in activism or you need to raise money for a cause close to you, a fundraising event is a fun and effective way to do it. Choose a cause and an event type, then find somewhere to hold the event. Schedule the event and organize all the necessary supplies, services, and staff so you have the logistics taken care of. Market the fundraiser and sell tickets to get people to actually come. On the day of the event, make sure to set up for the fundraiser well in advance to ensure it runs smoothly. Soon enough, you’ll be raising money for something important to you and helping out others!

Part 1 Choosing an Event Type.
1. Define the cause of your fundraising event. Choose a cause or issue that is important to you if you want to raise money for a charitable cause. Write down the reasons you want to raise money if it’s a personal cause, such as raising money for your sports team.
For example, you could choose to raise money for the fight against cancer, the humanitarian crisis in Sudan, or the battle against wildfires in Australia. Pick just one important issue at a time to fundraise for to avoid getting overwhelmed.
If you aren’t sure what you want to raise money for, but you know you want to get involved with fundraising, try talking to organizations in your community. Homeless shelters, veterans organizations, schools, and libraries often need funding, and you'll make a real impact right there in your own community.
2. Set your fundraising goal. Determine the amount of money you want to net, which is the amount of money you are left with after you subtract expenses, by calculating how much you need or want to raise for the cause. Having this number to work towards will help you plan the rest of the event.
For example, if you are raising money to combat wildfires in Australia, you could set a net goal of $10,000 to donate to charities that help that cause. This means that you want to raise $10,000 for the cause plus enough to cover the expenses of the fundraising event.
If you are raising money for something like a sports team, you can calculate how much money you need for things like new equipment or travel expenses to help you set your goal. If you need $1,000 for new jerseys and $4,000 to travel to a tournament, you would set a net goal of $5,000.
It’s best to be completely transparent with your donors and supporters about where the money you are raising will go.
3. Choose a target audience based on who you think cares about your cause. Think about the purpose of your fundraising event and decide if it will be geared towards a general audience or if it will target a more specific audience, such as friends and family of your sports team members, business people, or parents. This will help you choose the type of event and determine who and how many people to invite.
For example, a big charitable cause, like raising money for children in Sudan, can have a large, more general target audience because it is a world issue rather than a local one.
If you are raising money for a more personal cause, like a pet’s veterinarian bills, it would make more sense to limit the audience to family, friends, and close members of the immediate community who the cause is more relevant to.
4. Create a budget. Make a list of all the things you know you will need to spend money on for the event. Include things like staff, event space, food and drinks, invitations, guest speakers or entertainers, and any other items or services that will cost money.
If you don’t know the exact price of everything you will need to pay for just yet, that’s OK. You can make a spreadsheet with all the expenses listed, then fill it in with the estimated costs of each item as you continue planning.
You may be able to get services, items, and even event space donated by local businesses or organizations. Explain to them that you are hosting a fundraising event for your charity and that they can help a worthy cause and get exposure for their business by donating to your event.
5. Select what type of event to hold based on your audience and budget. Choose to hold something traditional like a car wash, a silent auction, or a dinner if you aren’t feeling too creative. Try something different like a race, a water fight, or a dodgeball tournament if you want to do something more unique and fun.
For example, if you're running a fundraiser to benefit your school's band, you could set up a school bake sale or carnival.
Make sure the event is an experience that is fun to participate in. You could have guest speakers, a band, activities after dinner, or anything else you can come up with that will keep guests entertained and engaged. Get creative!
When you’re brainstorming ideas for the event, you can choose between service-based events, like car washes, and competition-based events, like sports tournaments.
Tip: Remember to consider the purpose of the fundraiser, your budget, and the target audience when choosing what type of event to host. For instance, you wouldn’t want to throw a water fight if your target audience is seniors.
6. Find a place to hold the event. Look for large indoor event spaces like schools, wineries, restaurants, or conference centers if your event will be held inside. Search for outdoor spaces like parks or sporting fields if you are hosting an outdoor event.
You could try to find out where other similar events have been held and ask about the availability of those places.

Part 2 Scheduling the Fundraiser.
1. Schedule a date and time. Make sure the space you want to throw the fundraiser in is available on the day and time you want and reserve it. Leave enough time between now and the date of the event for invitees to respond, if applicable.
Don’t schedule your event on the same days as major holidays or other big events to avoid conflicts and maximize the number of attendees.
2. Tour the chosen location’s facilities to plan for the event setup. Make sure there is adequate space and find out what supplies are available to use, if any. Make a map of the space and draw in where different things will go on the day of the event.
For example, if you are hosting a fundraiser at an event space like a conference center, they probably have things like microphones, sound systems, and other electronics available to borrow or rent.
If you’re hosting an outdoor fundraiser, make sure you plan out where things like parking and concession booths will be.
3. Notify the proper authorities and complete any required paperwork. Research online or talk to other people who have hosted fundraisers in your area to find out what permits are necessary. Fill out any required paperwork and pay any fees to ensure your event is legal and avoid any fines or other problems.
For example, if you are holding a raffle, you may need to speak with the gaming authority. If you're selling food, you may need to check with the health department.

Part 3 Organizing the Event.
1. Purchase all the necessary supplies. Refer to your list of items that you made for your budget. Purchase as many supplies as you can ahead of time and make sure you know where to get anything else you need to purchase right before the event.
For example, for a silent auction, you will need things like tables, clipboards, paper, pens, and donated goods and services to auction off.
If you are having a meal at your event, you’ll need things like food, drinks, glasses, plates, and cutlery.
Tip: You can rent larger items that you will only use once, like tables and chairs, from an event supply rental company.
2. Book any services you need for the event. Hire any staff you need, such as security or wait staff. Schedule food service, entertainment, and anything else you need for the fundraiser.
For example, if you want to have live entertainment at the event, book a band in advance. If you want to tightly control entry, hire a security guard to attend the front door. If you are serving food, reserve a team of caterers to supply the food and serve guests.
3. Assemble a team of volunteers to work the event. Talk to friends, family, people you know who support your cause and ask them if they are willing to help out with your fundraiser. Gather enough volunteers to help you with pre-event activities as well as help run the event itself.
The number of volunteers you need depends on how big the event is. You can make a list of all the different roles and responsibilities you want help with to decide how many volunteers you need.
4. Delegate leadership tasks and other responsibilities to your event team. Once you have a team assembled, assign tasks to your team members and make sure everyone understands their particular job or task. Encourage team members to ask Question : s if they're unclear about their assignment or responsibilities.
For example, if you’re holding a silent auction, you might need 1-2 people to help you out with marketing and ticket sales before the event. Then, you might need 1 person to receive donations and handle money on the day of the event, 1 person to direct guests in the parking lot, and 1 person to usher guests to their seats.

Part 4 Marketing the Fundraiser.
1. Promote the fundraising event online. Use social media, email, and possibly a website to market the event. Create pages for the event on Facebook and Instagram to advertise it.
If you’re just doing a one-off fundraiser, it might not make sense to go to the effort of creating a website for the event. However, if you see yourself throwing more, it’s worth it to spend the time and effort on creating at least a basic website that you can use as a landing page with information about the event.
Tip: Ask friends, family, and supporters of your cause to promote the event through their social media channels. You could also try asking local businesses if they would be willing to promote your event through their social media.
2. Do email blasts to all your contacts. Create several emails including an initial announcement and 2-3 follow-up emails advertising the event that include links to all the event’s social media channels and information about how to buy tickets, donate, and attend. Send these emails to all your personal contacts.
You can also ask your friends, family, and supporters to forward or send each email to their contact lists as well to spread the word to more people.
3. Use traditional media to advertise the fundraiser. Take out advertising space in a local newspaper if you can afford it or contact the editorial department to try and get news coverage of the event. Reach out to local radio and TV stations to see if they will give your event news coverage.
You could consider other forms of traditional media, such as posters and flyers, but keep in mind that these methods are not very environmentally friendly. Only use them if you deem it absolutely necessary to get the word out.
4. Pre-sell tickets to the event. Use a free website, such as EventBrite, to sell tickets online. Ask local businesses if they are willing to be points of sale for physical tickets and advertise where the tickets are available as you market the event.
You can offer an “early bird” discount to encourage people to buy early.
You can also offer a group discount to encourage people to tell their friends and book in larger groups.
Consider a VIP Early Access event. For example, if you are hosting a silent auction, you can charge extra for VIP tickets that let holders get in to the auction early and scope out the goods. Or, if you're hosting a benefit concert, you could have a pre-concert meet and greet for VIPs.

Part 5 Preparing Finances.
1. Open a bank account if it is required in your area. In many US states, for example, you must establish a bank account for your charity if you want to receive donations from the public. Do some research online to find out if this is necessary where you live.
Put a name on the account to be sure it is clear for tax purposes. For example, if you are raising funds for a child named Susan Baker, who is getting treatments for cancer, name the account something like the “Susan Baker Donation Fund.”
2. Get a lockbox and change if you plan to receive cash and check donations. Store the cash and checks you receive in the lockbox. Keep change in the lockbox as well or have the person in charge of donations keep change in a fanny pack or cash bag.
If you will receive donations by check, print or write a large, clear sign letting donors know to whom the checks are payable that you can place somewhere visible during the event.
3. Acquire the right equipment if you want to receive credit card payments. Get a credit card machine or a mobile payment device, such as Square, that works with mobile phones if you want to receive payments by card.
Be aware that Square has fees attached and credit card companies take a percentage of each sale as payment.
You can also set up a PayPal account to help you take donations.

Part 6 Setting up and Running the Event.
1. Start setting up the day before or very early on the day of the event. There are always last-minute glitches that cause delays, so make sure you start preparing well in advance of your event's start time. Ask if you can set up the day or night before the event if you are hosting it at an indoor space, or get there first thing in the morning to start setting up on the day of the event to make sure everything goes smoothly.
Try to get a team of volunteers to help set up by asking friends, families, and big supporters of your cause if they are willing to come help you set up.
2. Do a practice run of the event with any event staff after setting up. Make sure everyone knows where they are supposed to be during the event and what their responsibilities are. This will ensure the event runs smoothly and there is no confusion among the helpers.
For example, if there is parking at the event, have one of your helpers practice directing imaginary traffic. If someone will be seating guests, have them rehearse how they will do this.
3. Provide clear instructions for guests. Make sure that attendees know exactly where to go and what the function of each space is. Create signs or handouts with details about the event, such as a timeline and a map.
For example, if you are running a silent auction, make large signs specifying where bids can be taken, where people go to pay, and any other necessary information.
Tip: If you need to provide verbal instructions during the event, make sure to set up a sound system and a microphone and test it out before guests arrive.
4. Put someone in charge of receiving and handling donations. Set up a donations table and assign a volunteer to man the table at all times to collect donations and handle the money. Provide them with a lockbox for cash and checks as well as the equipment needed to take any other forms of payment, such as a credit card machine or Square system.
Make sure that you have someone watching the money and donations table at all times. If the main person in charge needs to get up and go to the bathroom or something, ensure that someone replaces them temporarily.
5. Engage with guests during the event. Be positive and energetic. Ask guests if they are having a good time and if they have any feedback. Let them know how thankful you are for their attendance and generosity.
Think about ways to get guests engaged online, too. For example, you could create a hashtag for the event and ask guests to share their experiences via social media with the hashtag. You could also create an event filter on Instagram and have guests upload pictures using the filter while in attendance.
6. Send thank-yous to supporters and guests after the event is over. Publish general messages of gratitude to supporters, donors, volunteers, and guests on social media as soon as the event is over. Send personalized thank-yous via email to anyone you have the contact info for 1-2 days after the event.
Make sure to include info about how much money you were able to raise and remind everyone what the money will go towards.
Provide any relevant information about how people can continue to support the cause. For example, links to charities that receive ongoing donations for something like world hunger.

Community Q&A.

Question : Can you be too young to host a fundraiser? I am under 13.
Answer : You may need adult help, but you are never too young to do a fundraiser. My daughter did one when she was 8 years old.
Question : What should I write on the flyers?
Answer : You should only write eye-catching key points, such as the name of the events, and what will be offered (Games! Raffles! Food!) etc. Make sure to include the name of who the event is for and the name of who is running it. Possibly include sponsors.
Question : Where can I hold a fundraising event?
Answer : Some options are a local gym, park, church, or community center.
Question : Is selling food a good fundraising event idea?
Answer : Yes, and many organizations have raised needed funds through things like bake sales.
Question : How can I find someone who is a good fundraising planner to plan one for me?
Answer : The internet is usually a good place to start. Make sure to check around and make sure that whoever you're looking at has an established record as a good planner. Feel free to run a quick google search on anything you find. Look for things like customer testimonials and reviews if you can. Remember that the little, less well-known guys are sometimes just as good, so you could try taking a chance.
Question : Can I hold a fundraising event outside?
Answer : Outside events are a great idea as long as the weather is good, and you own the property. If it is on property you don't own, you will need permission from the land owner before you can proceed.
Question : Do I need any legal documents to set up a fundraising event?
Answer : It depends on the specific events that will take place at the fundraiser. For example, if you're holding a raffle or selling 50/50 tickets, you should check with your local gaming authorities. Also, if you're serving or selling liquor, you should look into a liquor license.
Question : What should the decorations be like for a raffle?
Answer : You can put out signs, posters, and other forms of advertisement on the stand you are selling the raffle tickets from. Use lots of color, and, if possible, have the prizes displayed.
Question : Can I hire dancers, musicians and artists for my fundraising project?
Answer : Yes. You have to make sure the performers are appropriate for your event, and make sure you have their payment and any needed materials, supplies or equipment. You may even be able to find some artists willing to donate their time for your cause.
Question : Is it possible to hire volunteers, musicians, dancers, comedians and the like for these events?
Answer : Yes. Ideally, you should try to find entertainers willing to donate their time to support your cause so that you don't spend too much money.

June 25, 2020