5 Budgeting Tips for Renters
We all struggle to keep a budget. Most of us have good intentions, but can’t always follow through on our commitments. According to a Gallup poll, only 32 percent of Americans currently maintain a household budget. But with about one-third of your income going towards rental payments, it’s time to start a budget.
Here are a few ways you can improve your budget as a renter:
1. Figure Out Your Monthly Income
Most financial experts will recommend that your rent payment should be roughly 25 to 30 percent of your income (before taxes). So if you make about $4,000, you should pay $1,000 to $1,200 for rent. Calculate your monthly income before you decide what your expenses should be. In doing so, you’ll ensure you have enough money to pay your bills and pay yourself.
2. Create a Savings Plan
You have dreams. We all have dreams. You can make those dreams become a reality by saving part of your income each month. Start with the bare minimum you can afford, like 10 percent. If you feel like you can increase this amount, go ahead. You should always pay yourself first before you pay anything else.
“Do not save what is left after spending, but spend what is left after saving.” – Warren Buffet
3. Don’t forget to include extra fees
When you move into a new apartment, sometimes you can forget about the small moving-in fees that can add up quickly. For instance, most apartment complexes require you to pay a security deposit. These are often the same amount as the first month’s rent. So plan on paying double during your first month.
Do you have a pet? Some apartment complexes require you to pay a pet deposit before you can move in. You may also have to pay utility deposits or administration fees. So, when you move into a new apartment, try to have a little extra saved for unexpected fees during that first month.
4. Buy Renter’s Insurance
While this fee may seem like a small burden to add to your budget at the moment, it is the only thing protecting you if there is a robbery or fire in your apartment. Paying renter’s insurance is just as important as paying health and car insurance. Protect yourself for tomorrow by paying a small fee today.
5. Cut Back on Expenses
There’s always something you could cut back on when it comes to your expenses. Make a list of the necessary, month-to-month expenses:
- 1. Rent
- 2. Electricity
- 3. Water
- 4. Gas
- 5. Internet
- 6. Phone
- 7. Renter’s insurance.
Is there any way you could cut back on these expenses? Maybe you could switch phone or internet providers. Or try to conserve more energy. Now look at the rest of your expenses. Is there anything else you could cut back on?
Living in an apartment can be a lot of fun. The community, reasonable rates, and amazing amenities are enough to make renting worth your while. But if you don’t keep track of your budget, your experience might be tainted with financial stress. So hop onto RentPlusMoney right now and get started on your budget today.