Discover the secret to splitting bills with friends without causing long-term divisions. Learn how open conversations, apps, and bank-sponsored services can make the process fair and painless.
When it comes to splitting costs with friends, whether you’re dining out or dividing household expenses, open and honest conversations are key. The wealth gap between friends can lead to conflict, as illustrated by a study published last year by US financial services company Bread Financial, which found that 26% of people felt financially incompatible with their friends.
Financial incompatibility refers to a situation where two individuals have different spending habits, saving rates, and financial priorities.
This can lead to conflicts and stress within relationships.
According to a survey, 62% of couples experience financial disagreements, with the top reasons being differing budgets (45%) and debt management (31%).
Financial incompatibility can be caused by various factors, including upbringing, lifestyle choices, and income levels.
When it comes to splitting bills, opinions are divided. A survey conducted by Compare the Market found that 34% believe bills should be split evenly, including tips, while 36% think it’s best to divide costs according to who had what. It’s essential to understand everyone’s views before making a decision.
According to Vivi Friedgut, founder and CEO of Blackbullion, a free-to-use money management app for students, having open and honest conversations right from the start is vital. This ensures that everyone is clear on who’s paying and how costs are being split equally. ‘It’s so easy to let friendships fall by the wayside because we’re awkward and money’s so emotional,’ she says.
Income disparity in friendships can lead to issues down the line, as Tom Allingham, communications director at Save the Student, explains. ‘People will often say, ‘I’ll get this, and you get the next thing.’ But what you find over time is that it doesn’t even out. So it might be that one of you gets one dinner and that might be £50, then the other one gets the next dinner. But that might only be £20.’ This can create issues for some more than others within the same friendship group.
Fortunately, there are growing number of bill-splitting apps and services that take the hassle out of dividing expenses between lots of people. You may want to explore a few options to figure out which one works best for your particular circumstances. Some popular options include Splitwise, Splid, and tricount.
Apps like Splitwise can be particularly effective in splitting small expenses between friends, such as grabbing a coffee. According to Talia Loderick, these apps can take the conversation away that often leads to nitpicking at the end of a meal or on holiday. ‘No one likes the nitpicking at the end of a meal or on holiday. The apps can take that conversation away.’
Splitwise is a mobile app designed to help friends and family split bills, expenses, and payments.
The app allows users to create groups for shared expenses, such as rent, groceries, or travel costs.
Users can add members to these groups, track expenses, and split the bill according to their contributions.
Splitwise also offers features like expense tracking, payment reminders, and budgeting tools
Some banks also offer bill-splitting services, such as NatWest‘s Housemate app (although it’s now discontinued), Monzo‘s Split feature, Starling Bank’s Split the Bill in-app feature, and Revolut‘s bill-splitting functionality. These services can be particularly useful for splitting small expenses or tracking joint expenses.
Splitting bills with friends doesn’t have to be awkward or painful. By understanding everyone’s views, having open conversations, and using apps like Splitwise or other bank-sponsored services, you can make the process fair and painless.
Bill splitting refers to the practice of dividing a shared expense, such as a restaurant bill, among individuals.
Studies show that people tend to overestimate their contribution and underestimate others'.
Research suggests that fair bill splitting can be achieved by setting clear expectations and using strategies like the 'rounding up' method or the 'average' method.
In 2019, a survey found that 60% of Americans believed that bill splitting was unfair in some cases, highlighting the importance of establishing clear guidelines.
- theguardian.com | How to split the bill without causing long term divisions
