WASHINGTON, May 16, 2017 – Moving into your own apartment for the first time can be a scary prospect. At the top of that list are the many new costs you may not have previously thought about when mom and dad were paying the bills starting with the monthly rent and utility bills that must be paid on time.
Many first-time renters quickly get in over their heads, sometimes with the result that they’re forced to borrow money to avoid falling behind with their payments.
As a first-time renter, the last thing you’ll want to do is put yourself in huge debt due to your move. Similarly, you definitely don’t want to be forced to give up your apartment and crash with friends, or worse, have to move back in with your parents because you decided to take an apartment you couldn’t actually afford.
The first tip to avoid the downfalls of first-time renters is to know how to properly budget for the move to your new apartment and the monthly expenses you will have.
Find Something You Can Actually Afford
Just because you have your heart set on finding a great apartment in one of the best places to live in New York doesn’t mean you will actually be able to afford it. The old rule of thumb was that your rent should never be more than one-third of your total monthly income. However, more and more housing experts are recommending that a person’s rent not exceed one-quarter of their income.
However, more and more housing experts are recommending that a person’s rent does not exceed one-quarter of their income.
Of course, if you’re good at budgeting and saving elsewhere, you could easily get by with spending half of your income on rent, but that is really hard to maintain and does not allow for any “oops” room or saving.
A lower rent will hopefully allow you to save so you can actually afford that fancy apartment you have your eye set on.
Don’t Forget About Utility Bills
Your rent does not always just mean a check to the landlord. Depending on the specific terms of the lease, and before you ask and get it into writing, you may have to pay for gas, electricity, water and other utilities. Relating back to the first point, that rule about rent not exceeding one-third or one-quarter of your income is meant to include these utilities.
Therefore, it’s always important to ask questions and potentially even call the relevant utility companies to get a better idea of how much these bills will be. In addition, remember that you may end up paying much more at certain times of the year so you’ll need to budget accordingly for these seasonal swings.
You may also want to consider, when shopping, apartments with sunny exposures for winter warmth, that come with window coverings to shade from the summer sun, and whose windows and walls do not leak cold, or hot, air.
Modern Conveniences Quickly Add Up
Smartphones, computers, internet and other modern inventions mean that people generally have more expenses than they used to. Therefore, it’s always important to put some money away and properly budget for today’s convenience costs. If you’re the type of person who can’t live without your smartphone or laptop, you’ll obviously want to ensure that you can afford the service to be connected and to have it repaired or buy a new one when it inevitably breaks.
There’s No Need to Buy All New Furniture
Having to furnish a new apartment can be tough if you’ve never lived on your own before, as you probably won’t have much furniture to begin with. Unless you have a ton of money put away, you’re better off buying cheap or used furniture at first and only buying whatever is absolutely essential. Spreading your furniture purchases out over a period of several months is a good way to ensure that you don’t immediately put a huge strain on your finances or go deep into debt.
Spreading your furniture purchases out over a period of several months is a good way to ensure that you don’t immediately put a huge strain on your finances or go deep into debt. Just remember, when it comes time to buying a big purchase, or items you will want to move with you, save money until you can buy the best you can afford.
Moving Costs Money
If you do have a lot of furniture or if you’re moving a long distance, you’ll also need to figure in the cost of moving. In some cases, you may end up paying hundreds of dollars in total moving costs, so it’s important to keep this in mind when budgeting.
Don’t Forget the Deposit
Some first-time renters are surprised when they learn that they’ll have to pay more than just the first month’s rent to move in. It used to be standard for renters to pay first and last month’s rent and a security deposit equal to one month rent.
However, many landlords are now requiring security deposits equal to two or even three months’ rent. Should you have a pet, you’ll probably find yourself facing another, usually non-refundable deposit. All of this means you may have to fork over anywhere from three to five times the rent in order to sign a lease.
Again, make sure you read the lease carefully and confirm more than once with the landlord that ‘this’ is all the costs I will have.
Budgeting for your move isn’t all that difficult, and luckily, doesn’t require any complicated math. Instead, all it takes is paying close attention to your finances and making sure you’re prepared for all of the eventual expenses your move could lead to. Still, no matter what you do, it’s always a good idea to have an emergency fund set aside just in case.
Still, no matter what you do, it’s always a good idea to have an emergency fund set aside just in case.