Living on Your Own

The cost of living on your own, to have your own place, depends mostly on what you’ll have to pay for housing. Chances are, you will focus on the monthly cost to rent an apartment or a house with or without roommates in your area.

So how much rent should you pay? There’s a popular rule-of-thumb that suggests your income should be around three (3) times your monthly rent. Many apartment complexes and landlords follow this rule. For example, if you’re looking at an apartment that rents for $1,000 a month, you’ll need to earn at least $3,000 a month to qualify for it.

Another rule-of-thumb says your living expenses shouldn’t exceed around 25% of your pay. So, if you earn $3,000 a month, you might look in the $750 per month range instead.

When determining how much rent you can afford, create a budget based on your take home pay and see how your rent and estimated living expenses fit into it.

Your budget should include rent and utilities. Rent may also include a fee for a covered parking space, a pet, yard work, and/or pest control. There is electric, gas, water, as well as cable and internet options to think about. Estimate personal expenses and add in current payments, transportation cost, phone, groceries, entertainment, and laundry.

If this is your first time fully living on your own, you might have to adjust your expectations and numbers a few times once you have been tracking expenses in real time.

Click here to learn more about how to budget while living on your own and to see if it is financially feasible.