Finances, Roommates

Splitwise

If you don’t watch TV that often, but your roommate does, is it fair for you to pay half of the cable bill?  If you have the bigger room in the apartment, is it fair for your roommate to pay half of the rent?  Well, with Splitwise, you can make sharing expenses a more fair, and less awkward process.  Recently we sat down with Splitwise CEO, Jon Bittner, about what his company does and what Splitwise can do to make splitting the bill fun and easy.

What is Splitwise?

Spitwise is a great way for roommates to keep track of their shared expenses, make sure everyone pays their bills, know who owes who, and make living with room­­mates a harmonious and fun experience.

What is the philosophy behind Splitwise?

At Splitwise, we want to make it stress-free to split expenses with your friends.  One part of that is that it’s really fun and easy if people don’t have to be constantly paying each other.  It’s annoying to collect money from your friends because no one ever has the right amount of cash on hand and sending checks or e-payments around is all very annoying.  What we have created is a virtual account or tab for your group that makes it really simple to keep track of who’s paid for which bills, make sure everyone has paid their fair share every month, and then they can settle it up.

Another thing that we do, that might be helpful to students who are looking for apartments on JumpOffCampus, is to help you to figure out how you should split the rent with your roommate.  Our philosophy about rent splitting is that it is really awkward to haggle about how much each person should be contributing to rent.  As soon as you decide to share a new apartment, you can just put in the variables and our rent calculator will give a neutral recommendation for how much each bedroom should cost. It takes into account bedroom size, windows, whose sharing a room, and some other stuff like that. At Splitwise, we want to make it really fun and enjoyable to live with roommate.  Splitting up the rent for roommates is just one way to avoid a fight. We’re very excited to have JumpOffCampus feature it on their site.

How did Splitwise get started?

A few years ago I was living with my then-girlfriend, now fiancé, and we had a roommate named Tory who was wonderful.  We had agreed to split the rent equally (each person).  It was an expensive place in Boston; we each had to pay, I think, $800 a month for this really nice place. It seemed fair because we had a huge bedroom and Tory had a normal-sized bedroom.  It seemed fair to do it this way – we had a lot of space, maybe twice as much space as her.  But I started to think, was that fair?  Was I being unfair to my friend?  I thought about it, and so I created a survey and sent it to my friends asking a bunch of hypothetical questions about what would be fair for all these different variables.  Some of them were about the situation that I was in, and some were just in the abstract.  When I put it all together I decided to create a little rent calculator that would incorporate all of that data I had just taken.  I put that on the Internet and people have just loved it.  We’ve had over 100,000 people use it, even just in the first month, and hundreds of thousands more since.  It’s a great tool and I know that people get a lot of value from having some suggestions, some sort of neutral arbitrator or neutral third party, that can recommend something when you’ve never done this before, or even if you’ve done it before but you haven’t been in this exact situation.

What do you believe is the hardest part of splitting the bill?

There’s doing the math, having the cash on hand (the exact change which no one ever has), and the awkwardness of “Did you put in enough?”  “Why are we short? Did you have an appetizer?”  “Oh, there’s too much money.  Who does it go back to?”  That could be for a restaurant bill, of course (a common one), or even for like a utility bill when you don’t know why you’re paying so much for the cable and you don’t watch it.  The best thing to do with sharing is to make sure you know what you’re getting into, have a good sense of expectations. And it’s obviously good to discuss how bills are getting split in advance, even if you’re not going to have a formal roommate agreement.

What value do you place on providing people an easier way to split the bill?

I see the value in the relationships saved or in just having a more fun experience; where you feel like you have this little virtual bar tab or house account and you don’t have to think about money so much. It’s always fun to not to have to think hard about money and not have it be so transactional.  All of the people on our team were doing something like Splitwise before we came together and made an official version with the app and the website.

In general what factors would you say lead to a bad roommate experience?  A good roommate experience?

I think bad communication is always the root of it . . . or just terrible people.  If you have people who are very stubborn or unworkable then sometimes it will ruin everything.  Of course, people who are lazy and who don’t do their share are always the people everyone gets so frustrated with, and I think they make bad roommates unless everyone has the same attitude.  Mostly it comes down to picking people who you can communicate well with and those who have a shared set of expectations.  It’s also really great not to have to be explicit about your expectations.  No one really wants to sit down and make a roommate agreement.  I know some people do that and that’s a sensible idea, but it’s not necessarily very fun.  I’ve never made one. I think bad roommate experiences come from bad communication, people who don’t do what they say they do, or roommates who are just horrible people.

Good roommate experiences can be so wonderful.  Actually, it’s much nicer than living alone; living alone can be very isolating and roommates are like free friends.  So if you pick people who trust, people whom you think are fun or who are sensible (bare minimum sensible), I think it can be very pleasant.  Even if they’re not going to be your best friend, they could be really positive influence in your life.  We hear all kinds of good stories as well as bad; most of the bad stories come when people haven’t talked with each other and have started assuming what the other person is thinking.

How do you feel about best friends rooming together?

It can definitely work well; it’s certainly a risk.  I think that it’s a good idea to do it on a short-term basis first.  A good test is to go on a trip together.  That’s also a good test for people whom you want to work with.  When you travel you experience most of the same troubles.   How do we deal with the money?  How do we deal with the space?  “I want to go to bed now.” “I want to invite people over.”  Traveling is a good way to test it, but it’s definitely a risk.  I think it’s easier to make friends with your roommates than it is to have your friends become your roommates.

Can you share an experience you had with a bad roommate?

Fortunately I’ve only had one really bad experience with a roommate, but maybe it’s too colorful for the Internet, if such a thing is possible.  I probably wrote my best essay in college about how frustrating I found him.

Who can use Splitwise?

Splitwise is great for anyone who has friends, but it’s especially good for roommates and couples too.  The people who love it best are the people who have roommates that they’re really tight with and they share a lot of things with.  So people who are like, “Let’s all go out and I’ll get groceries for us” or  “We’re going to throw a party, and I’m going to buy all the beer this time.”  Or couples who are like, “Every time we buy plane tickets together, I just throw it up on Splitwise and I don’t have to try to move around big chunks of money.”  I know couples who are unmarried (who don’t have shared bank accounts), and roommates love it.  It’s great for sharing vacations too.

How can people access Splitwise?  How can they get started?

If you’ve got a room and you’re not sure how to split up the rent, check out our calculators (Splitwise.com/calculators).  If you’ve been living in a place and you’re trying to keep track of all the bills go to Splitwise.com or in the app store at Splitwise (the iPhone or the Android app store).  Just search for Splitwise.

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One thought on “Splitwise

  1. Pingback: An Interview With JumpOffCampus | Splitwise Blog

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