You’re finally ready to venture out by moving into your own apartment. This can be an exciting and worrisome time because of the costs associated with moving into your own apartment for the first time. There are many expenses to consider when moving out of your family’s home or forgoing roommates. Here are the factors to plan to save for before moving out.
1. Calculating Ideal Cost of Rent
The first step to calculating your new living situation expense is to determine how much rent you can afford given your current income. Your monthly income should be at least three times greater than the rent of your new apartment. For example, your income should be $3,000 per month for a $1,000 per month apartment. Many landlords follow this rule of thumb when determining if the prospective renter can afford the rent.
2. Management Fees
Depending on the landlord or apartment complex, you may have to pay for a credit and background check with your application. Some complexes will also charge an application fee just to put your name in the hat.
3. Security Deposit
A security deposit is often required upon your move-in. Security deposits are typically double of the cost for one month’s rent, so saving for this expense is crucial. The security deposit cost can increase if you have pets.
Utility expenses can add up quickly. Make sure to factor in utilities such as trash, internet, parking, pet fees, electricity, gas, TV, and administration fees.
5. Moving Costs
An often overlooked expense is the cost of moving itself. If you DIY your move, expenses to consider include the truck rental, boxes and packing tape/materials. If you hire movers, make sure to inquire about all fees that are associated such as the minimum amount of hours they charge.
6. Renter’s Insurance
Many apartment complexes will require you to pay a monthly renter’s insurance to protect you from unexpected situations such as flooding or theft. Car insurance companies often provide renter’s insurance and can even bundle the policy together for a discount.
7. Food Costs
Another important but often overlooked factor when moving into your own apartment is your cost of food. This is especially important if you were living with a family where you shared the monthly grocery bill. Now that you’re on your own, figure out a grocery and dining out budget to make sure that you can afford living in your own apartment.
How much you should save before moving into your apartment will vary widely depending on your location and living costs. Make the best estimate you can in the outlined categories, then add $500 per month for surprise expenses such as a broken microwave or flat tire. Always go on the side of caution when it comes to finances so you can live comfortably in your new space.