There comes a time in every person’s life when they decide to try living on their own. Getting away from slobby roommates or gaining more space for yourself sounds great, but is it affordable?
You might feel like you have reached this point in your own life but may be hesitating because of the costs. Renting a place by yourself is not always as cost-efficient as it is to share a place with roommates, though it does come with added freedom and independence.
Before you figure out if you can afford to move out of your current living situation and into your own place, ask yourself these three questions:
Do I have savings?
Renting your own place is not just a monthly expense, especially when you first move in. A new place means a security deposit, usually the equivalent of a month’s rent, plus your first month’s rent up front. Depending on your landlord, you may have to pay for your last month’s rent before move-in as well. A good rule of thumb is to save up to three months of rent to cover these costs as well as any other move-in fees your landlord may require.
You will also need some extra cash on hand for the move itself and any furnishings and necessities you need to acquire for your new residence. A fully-furnished home or apartment may be a good option if you don’t own furniture already. Be sure to give yourself enough of a window with savings to comfortably cover these move-in costs so you can kick back and enjoy your new home after all the stress of moving.
What is my credit score?
Another essential element of renting your own place is your credit score. Your landlord will use your credit score to determine if you are likely to pay your rent on time or not. To your landlord, a high credit score means that you are responsible when it comes to paying bills, and a low credit score means you are not responsible enough to rent their property.
If your credit score is too low, you can work to improve it over time, but be prepared to wait. Improving your credit score often means paying down debts and making more payments on time.
Can I handle the monthly payments?
Take a critical look at your monthly rent payments, even if you have the savings and the credit score to get the place you want. Ask yourself if you can afford the monthly rent payments. A typical rule of thumb is to make sure that your monthly rent payment does not exceed one-third of your take-home pay.
It might be a good idea to take a step back and reconsider living on your own if you can’t find a place that fits the one-third ratio of rent to income. Splitting the cost makes everything cheaper, which is why living with roommates might be a good idea until you can find an affordable place. After all, it is not just rent you need to consider. You will also have Internet, utilities, grocery costs, and more. When you live with a roommate, these are all expenses that you can share to reduce your overall cost of living, helping you save money over time.
If you are set on living on your own, create a budget to ensure that you can pay for everything that you need each month. Your budget should include everything from groceries and entertainment to health care and savings. If your paycheck covers everything in your budget, congratulations! You are now able to afford living on your own.
With honest and careful consideration of each of these three questions, you might find that you are ready to rent without a roommate. A considerable savings, credit score, and monthly income make moving into your own place a desirable and attainable goal for any adult looking for some added independence.
For more tips on affording and finding that new place, check out 208.properties on social media or contact us today.