Moving out on your own for the first time can be an exhilarating experience filled with new freedoms, opportunities, and adventures. The excitement of having your own place, creating your own style, and living with complete freedom for the first time is an unbelievable feeling.
As exciting as this new phase of life is, it comes with a significant amount of responsibility and financial commitment. While the thought of living on your own may be thrilling, it’s essential to be mindful and proceed with caution. Things like rent, utilities, groceries, and other expenses can add up quickly, and without proper budgeting, it’s easy to get into financial trouble.
Let’s look at some practical tips and insights that can help you make the most of this exciting new chapter in your life.
Your New Expenses When Moving Out
Let’s consider the expenses you’ll face when you decide to move out on your own. Everyone has their own unique situation, but these are the most common costs you might want to consider.
- Rent: This is the most significant expense you’ll have when moving out. It varies by city and neighborhood, collecting data on areas with different price points to help you make a decision.
- Security deposit: Landlords often require a security deposit before you move in. This is commonly called first and last worth of rent and will be required usually before you move in.
- Utilities: Utilities such as electricity, gas, water, and internet are essential but can add up quickly. In the United States, the average cost of utilities in Canada is $389 per month. This doesn’t include monthly subscriptions to services like Netflix, Prime, Disney+, etc.
- Furniture and household items: If you’re moving out for the first time, you’ll likely need to purchase furniture and household items such as bedding, kitchenware, and cleaning supplies. These costs can vary widely depending on your preferences and needs.
- Food and groceries: You’ll need to factor in the cost of food and groceries into your budget. In Canada, the average cost of food and groceries for one person in 2022 was $308 per month. That doesn’t account for dining out.
- Transportation: If you own a car, make sure to factor in the cost of gas, insurance, and maintenance. If you rely on public transportation, consider the cost of tickets or a monthly pass.
- Moving expenses: Whether you’re hiring a moving company or renting a truck, moving expenses can add up quickly. Make sure to get moving quotes before making a decision to do it yourself from a reputable moving company.
- Personal expenses: Finally, don’t forget to factor in personal expenses such as entertainment, clothing, and other discretionary spending. You may have to make some sacrifices in this area to keep your spending in check.
Create A Budget
Creating a budget before moving out is crucial to ensure that you can afford your new living expenses. For one, it will help you save money for the move and you’ll have a headstart on the creating a good habit you’ll need once you’re on your own. Once you have a budget in place, it’s equally important to stick to it.
To stick to your budget after moving out, you need discipline and consistency. Track your expenses and income regularly to ensure you’re not overspending. You can do this manually using a spreadsheet or budgeting app, or automatically through online banking tools.
Saving For Expenses
When you’re preparing to move out on your own, it’s important to save up for various expenses you’ll encounter. Start by figuring out how much you’ll need to save each month to reach your goal.
Look for ways to reduce your current expenses. This can include cutting back on non-essential purchases like eating and drinking at restaurants and bars. Sometimes you can reduce your monthly bills by negotiating with service providers or finding cheaper alternatives, or even picking up a side hustle to earn extra income.
Consider setting up automatic savings transfers. This allows you to set aside a specific amount of money each month without having to remember to do it manually.
The Importance Of A Steady Job
Before you move out on your own, you need to have a steady source of income to cover your expenses and in most cases securing a mortgage or lease. If you aren’t already working full time, it might not be the right time to move out.
Once you’re getting a steady paycheck and feel stable in your job, figure out what your average monthly income is. As a general rule of thumb, it’s recommended that no more than 30% of that should go towards rent, utilities, and other basic recurring expenses. This allows for a comfortable living situation without overspending or becoming financially burdened. You need to account for the other monthly costs mentioned above when budgeting to ensure you have a clear understanding of your financial situation.
Consider Getting A Roommate
Having a place all to yourself is tempting, but getting a roommate can offer several benefits. Sharing living expenses can significantly reduce your monthly costs, including rent, utilities, and groceries. This can free up more money for saving or other expenses like going out with friends. A roommate can also provide companionship and emotional support, particularly if you’re moving to a new city or living alone for the first time. They can also help with household chores and maintenance, making it easier to manage your living space.
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Establish Emergency Savings
Even with careful planning, unexpected expenses can still arise. Having emergency savings is essential when moving out because unexpected expenses can arise at any time. An emergency fund is a reserve of money set aside to cover unforeseen expenses such as car repairs or a sudden job loss. It provides a safety net that can help prevent financial stress and avoid accumulating debt.
Experts recommend having at least three to six months’ worth of living expenses in emergency savings. To set money aside, you can budget a certain amount each month specifically for your emergency fund and setting it aside from your savings will deter you from dipping into it.
Ready To Take That Next Step?
Moving out on your own can be a big step, so it’s important to make sure you’re fully prepared for the responsibility. Take the time to assess your financial situation, career prospects, and personal goals to make sure you’re ready for the challenges of living independently. If you feel confident and ready to take the leap, start planning your move and enjoy the excitement of this new chapter in your life.
One important thing to consider when moving is working with an honest and reliable moving partner, who’ll help deliver a seamless and stress-free move. Click here to book your upcoming move with us! And discover why Hills Moving was voted Best Moving Service in Durham.