Talking to roommates about money

Money can be one of the most difficult things to talk about with your roommate, especially when the cost of everything is getting more expensive. We surveyed people who’d taken in a roommate - over half said they’ve found it difficult talking to a roommate about money.

So we thought we’d put together some ideas and advice - all of them came from people in exactly the same situation as you. These will help you go into those conversations with confidence and make sure you have a positive experience.

In general

By far the two words that came up most when we asked were ‘open’ and ‘honest’. Pretty much everyone was in favor of approaching the subject directly and not trying to talk around it or bury it in a conversation about something else.

“Be upfront and honest and talk when an issue arises, rather than trying to pretend it's not happening.”

One of the most interesting things was the amount of advice people offered on when to have the conversation.

When to talk about money with your roommate

Many people said there’s quite a bit of groundwork you can do in advance to make things easier. You might think it’s a case of discussing money as and when you need to, but there are definitely things you can do before it comes to that.

“Be clear from the outset. We have found it is much easier to discuss finances at the very beginning, rather than being vague and then raising issues later down the line.”

“The most important thing always is to ensure you have a good relationship with the roommate. That needs to start from the beginning and makes it easier for both of you when it comes to discussing difficult issues.”

Some people are in favor of keeping things fairly formal, at least to begin with:

“I always try to establish a business relationship first, then if that later leads to a friendship all the better, if not then it doesn’t. With a business relationship already established, it’s easier to approach the subject of money. My tenant always knows that my sharing my place is based on financial need, not for lack of companionship or to have more friends. It may sound cold but it’s important to be honest and upfront from the beginning.”

Others find it easier to approach things from a less formal starting point:

“I try as soon as possible to get to a stage where my tenant is a friend as well as a roommate. This means we have regular conversations and I include mentioning any additional costs that I might be incurring at the property as soon as they occur.”

You can also help avoid issues by having a clear roommate agreement:

“Make a well written contract or document before approaching the discussion…then read it together and make adjustments before finalizing it. Have all roommates sign the agreed upon document, so if there is trouble in the future, they can refer to the document.”

You can also factor in reviewing things at the start of the tenancy:

“Enter into an agreement that ends in 12 months or less. Be clear with your roommate that an agreement beyond will depend on a review of the rent, to take into account any cost increases. I always want to be reasonable, as having a reliable, good roommate is worth a lot.”

That can be particularly useful when it comes to including utilities in the rent:

“I agree a nominal fee for the first 2-3 months and then say I will review it, depending upon usage increase and rising costs. I really only want to charge to cover the increase in bills due to having a roommate, not more, and this is difficult to predict.”

There are also things you can do to address how much energy you’re using in the first place:

“Try to encourage a 'green Eco' ethos from the beginning, lead by example, notice and verbally reward positive actions; turning lights off, keeping heating low, sharing the oven etc”

How to have a conversation about money

However much you plan in advance, and however good your relationship, there will be times when you unavoidably need to discuss money. Here’s some great advice we got from SpareRoom users on how to go about it:

“Always discuss things at the end of the month, when most people are paid and are more upbeat - not when they are struggling just before!”

“Make sure neither of you are rushing off out and that you have a general conversation in a relaxed atmosphere. Then broach the subject of price rises and that, much as you regret it, you will need to raise the rent.”

“Make it a formal meeting with a set time when you both have the time available to talk. Do not start the conversation when you know that your roommate is just rushing off to work, for example…Remember, this is a meeting, NOT an argument.”

“Involve the tenant. Ask for their ideas and advice on what you could all do in the household to prevent the impact of the looming increase…actively apply their ideas around the house.”

If a rent increase is unavoidable…

“Give them the top line and the details of how any increase in rent has been calculated (e.g. inflation, energy crisis, etc.)”

“Provide a notice period before the change comes into place, ideally with a letter with all the details and calculations. I advise 2 months if an increase is predictable.”

“Be considerate and ask if there is anything you, the landlord, can do to help (eg. stagger the payments into smaller lots to help them better manage their finances if they are paid weekly, etc).”

Ways of talking about money

Plenty of people advised that respect is important, as is understanding things from your roommate’s point of view:

“Be direct, be clear & honest, don't apologise for costs outside of your control rising. Be respectful in all communications”

“Be fair. Be reasonable. Explain why you might need to take action. Understand that they will be feeling the financial pinch too.”

But some people also said it can help to explain your situation to them, as they may have made some incorrect assumptions about your financial situation:

“Be direct and stand your ground. Roommates generally think that you have no expenses and that the money they are paying you is going towards you having a good life!”

“If you are a landlord, tenants always think you are loaded. If you were loaded you wouldn't have a roommate!! They need to understand that both of you have something the other one needs and neither of you want to quarrel about it.”

“At the interview stage, I make it quite clear that renting my spare room is not a hobby - it is an important income for me. In order to plan my life and ensure bills etc are met, I need prompt, regular payment. I also add that I am more than happy to discuss any issues the roommate may have and am happy to help.”

“Be transparent about your actual annual energy costs, so they can see for themselves that you are being fair and not profiting from the increase.”

We also heard that giving people time to deal with any changes can be really useful:

“Give them a couple of months advance notice of any increase to give them time to readjust their finances.”

“Be straightforward and give plenty of warning of any increases. I give 2 months warning of any bill related rises, so that they can make plans to leave if they are not happy about it. This goes down well and no one has ever left because of a proposed rise.”

You could also be creative about how your roommate could contribute:

“Maybe ask for unpaid help in the house or garden as an alternative”

In summary

Hopefully this has given you some ideas to help ease those tricky conversations. As with most things roommate related, the best advice is to do whatever you can to avoid problems occurring in the first place. If you do need to deal with an issue, communicate early and clearly and be open with your roommate. After all, most people really don’t want to argue with you about money either!