Money & Career

Ask Bruce: Should the higher earner in a household pay more?

Wondering what's fair when it comes to sharing the mortgage? MoneySense pro Bruce Sellery has the answers

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Bruce Sellery

 

When two people buy a house, is it normal for them to split the monthly mortgage payment 50/50, even if one person makes more money? M.S., Toronto

Dear M.S.,

Relationships are funny. What’s considered “normal” behaviour for one couple may be considered completely absurd by another couple living right next door. In my opinion, “normal” doesn’t matter. What matters is what works for the two of you, based on what you want. Take a big step back and talk about what you want for the future — both as individuals and as a couple. Then figure out how you’re going to pay for it. Not just the mortgage — all of it: house maintenance, groceries, vacations, cars, kids, retirement savings and your respective vices. Sure, when there is a disparity in income, it can be a challenge to decide on priorities. When thinking long term, it is best if your retirement incomes are as close as possible, in order to minimize the tax you pay. This means the higher-income earner should pay more of the expenses until retirement. Hopefully you’ll have a long and happy life together.

Bruce Sellery is a personal-finance expert and author of the bestselling book The Moolala Guide to Rockin’ Your RRSP. He’s a columnist for MoneySense magazine and a regular guest on Cityline and the Lang & O’Leary Exchange. His website is moolala.ca.

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