Are you thinking about moving into your first apartment? Well, congrats! Although renting an apartment is more affordable than buying a home, there are other expenses besides rent and utilities that you should make sure you can afford before you make the leap. The following is a general breakdown, (percentage-wise) of your expenses, as provided by Quicken:
- 30% Housing
- 10% (Utilities and other housing expenditures (including renters insurance)
- 15% Food (at home and away)
- 10% Transportation (including car loan)
- 10% Debt repayment (student loans and credit cards)
- 10% Savings
- 5% Clothing
- 5% Entertainment
- 5% Car insurance and miscellaneous personal expenses
It’s worth noting that these expenses will vary according to the individual. For example, some renters won’t have any debt, while others might have to make debt repayment more of a priority.
How Much Should You Save before Moving Out
Budgeting should start long before you move out. It’s best to start saving 25-30 percent of your paycheck for rent while you’re still living at home. Also, it’s a good idea to have three month’s rent saved in your account before you move. This will help cover deposits, moving expenses and other miscellaneous items.
Ways to Save Money
Once you’ve moved, budgeting should still be a priority. This doesn’t mean you have to starve while you sit at home doing nothing, there are easy ways to save money so you can still enjoy being on your own.
- Save around $80+ a month by cutting cable. Instead, purchase subscriptions to Netflix and Hulu which are $8-$10 a month each.
- Eat in instead of eating out. You can save $25 or more a week by packing your lunch with leftovers from last night’s dinner.
- Invite a few friends over for movie night at your apartment instead of going out. Grab a new release at Redbox and a couple bags of microwave popcorn and save $20+
- Save money on utilities by turning off lights when you leave a room and invest in energy efficient lighting
- Consider a roommate to share expenses on rent and utilities.
- Carpooling, walk or ride your bike to save money on gas
- Refer your friends and family. Most apartment communities have referral programs for residents. An easy way to make some money and surround yourself with friends in the neighborhood.
- Download this to help create a budget plan. Enter your incoming and outgoing expenses to help you stay on track.
Your first apartment on your own should be a fun adventure. If you haven’t already found your new apartment here are some more resources you may want to check out: