How to split holiday costs fairly
Fair is not the same as equal. Most holiday money arguments come from splitting something equally that should not have been, and nobody wanting to be the person who says so.
What should be equal
- Accommodation, unless rooms are genuinely different
- Groceries and shared supplies
- Transfers everybody took
- Anything the whole group used
What should not be
These are the exceptions, and they have to be recorded as exceptions at the time. Nobody will reconstruct them fairly on the last night.
- Excursions only some people went on
- Drinks, when some of the group are not drinking
- A meal where one person had a starter, a main and three glasses of wine and another had a salad
- Anything bought for one person
The person who paid up front
Deposits paid months in advance are the most commonly forgotten expense, and they are usually the largest. Log them the day they are paid.
It also changes the dynamic: instead of one person quietly hoping to be reimbursed, the group can see from the start that they are owed.
Currencies
Record every expense in the currency it was paid in, and store the exchange rate at that moment alongside it.
Converting on the fly at today's rate means balances change every day without anyone doing anything, and that is the fastest way to make a group stop trusting the numbers.
Settle once, not continuously
Paying each other back as you go generates far more transactions than necessary. Let the ledger run and net it all off at the end.
Four people with debts in both directions can look like eight or ten payments. Netted, it is usually two.
The penny problem
A hundred pounds between three people is £33.33 each, which comes to £99.99. That missing penny seems trivial until you have thirty expenses and someone notices the total is out.
Give the remainder to somebody rather than rounding it away. It is a small detail that keeps the whole ledger trustworthy.