Budgeting

How To Afford To Live Alone

Thinking about moving out and living on your own? If so, expenses are probably at the forefront of your mind. You may be thinking, is $5000 enough to move out, what are the best cities for working women, or how much do I need to move out? Here you’ll find tips on how to afford to live alone and maintain financial stability. 

How Much Does It Cost To Live By Yourself? 

How much does it cost to have your own place? That depends on a few factors like:

  • Location. 
  • Income. 
  • Property type.

Below is the average rent of a one-bedroom apartment in some of the most popular cities in the United States: 

  • Austin, TX : $3,277.
  • Columbus, OH : $1,321.
  • Detroit, MI : $1,597.
  • New York, NY : $5,576.
  • Atlanta, GA : $1,597.
  • Charlotte, NC : $1,528.
  • Los Angeles, CA : $3,166.
  • Jacksonville, FL : $1,462.
  • Chicago, IL : $2,403.

Top Tips To Afford Living Alone

Check out some of the tips below on the cheapest way to afford living alone. 

Have a Budget and Stick To It

Live frugally to make the most of your money when you’re living on your own. Mindlessly shopping or frequent impulse purchases can easily cause your bank account to become overdrawn, leaving you without enough money to afford living expenses. 

Instead, map out your expenses and create a budget. Then, stick to that budget. You can make this goal more accessible by practicing money-saving strategies like the 30-day rule

With the 30-day rule, you wait at least a month (or 30 days) before purchasing something outside of your core budget. If you still want to make the purchase at the end of the 30 days, the item is probably something you really want or is important to you. But, you may find that giving yourself time to think about your purchases instead is enough to deter you from buying something you may regret in the near future. 

Reevaluate Your Spending Regularly

To practice good money management skills, you want to look at your budget every so often and make adjustments where needed. While core items like bills may not change frequently, other aspects of your spending might. For example, say you want to do a no spend money challenge. In that case, you may want to cut down your previous grocery budget to encourage you to eat out less and cook at home. 

Reevaluating your budget will also give you a chance to consider your wants vs. needs and perhaps cut out expenses that you previously wanted but do not need. 

Have an Emergency Fund and Save Money 

If you do not have one already, you may want to get an emergency savings account. Having extra money set aside in an emergency fund can alleviate a great deal of stress when you come across unexpected expenses.

Get a New Income Stream if Needed

It may be a good idea to get a second job or side hustle when living alone. If the net income from your first job is enough to cover your expenses, a side hustle can give you a financial cushion, allowing you to have more money for your monthly expenses. Or, you can use your second stream of income specifically for savings. 

Sell and Downsize Where You Can 

Before you move, go through your possessions and think about what you really use every day. Are there clothes, appliances, decor items, or other things you don’t regularly use anymore? If so, sell them to earn some extra money! Selling items you don’t reach for anymore is a great way to get some extra cash for moving or living alone. It is also a fantastic way to get rid of clutter around your home! 

Shop Secondhand

Save money and shop secondhand at thrift stores. You can find fantastic deals on just about anything at Goodwill stores or other thrift shops around your area. While you may not want to shop secondhand for things like a mattress or undergarments, you can definitely save money by purchasing items like street clothes, books, jewelry, and more at a thrift store.  

Monthly Expenses When You Live Alone

When you live alone, you are responsible for all your monthly bills and living expenses. Before you move, get an idea of all the costs you will have to cover, so you are financially prepared. 

Common bills and expenses you will have to pay for when single living is below. 

Rent / Mortgage 

Paying rent or a mortgage is perhaps the most critical expense to cover when living alone. If you own a home, you will be paying a mortgage, but if you are renting from a property owner, you will be paying them directly. The monthly cost of rent or a mortgage will vary depending on the location and property type. Paying your rent or your mortgage ensures you keep a roof over your head. 

Utility Bills  

Along with the property itself, you will have to pay for the utilities that allow the home to function properly. Gas keeps your home warm in the winter and can also power appliances like a stovetop. Electricity allows you to use your lights, charge your computer or phone, keeps your fridge cool and running, and more. Water enables you to use faucets in your bathroom and kitchen so you can drink and clean things. 

Insurance

Insurance is also another core expense to pay for when living alone. You will need insurance for your property (homeowners insurance or renters insurance), insurance for your vehicle if you have one, as well as health insurance. 

Groceries 

We can’t survive without food, so make sure you budget money for grocery shopping. 

Gas / Transportation 

If you own a car and commute to work daily, you will need to invest money to pay for gas. While public transit is less expensive than driving yourself everywhere, you should also still factor in taxi or bus fares as well. 

Entertainment

Cable and streaming service subscriptions are technically a luxury expense, but it’s something most people want to have and use in their everyday lives. When you go through all your subscriptions to create a budget, you may even find that there are services you no longer use and, therefore, can cancel. 

How Expensive Is It To Move? 

Depending on when and where you are moving, costs can get high. To ensure you are prepared, ensure you have the core expenses covered before moving out. 

Moving Out Checklist 

Before you move out, financial planning is essential. Below are some tasks you may want to complete before you move out to live on your own. 

Know Your Income

Your net income is how much money you have left over after all your expenses are paid. To determine your net income, calculate your core bills and expenses and compare that to your monthly income. 

Understand Your Credit Score 

Your credit rating will play a significant role in what types of property you qualify for. When buying a home or even renting, you will have to complete an application with the property owner. This application will contain your credit score, which property owners will then look at to help determine if you are a financial risk. Having an accurate idea of what your credit score is will help you decide what types of properties you should start looking at. 

Know Your Budget

Create a budget of fixed expenses and debt payments before you move. That way, you will know exactly how much money you need to afford to live alone. 

Take Time off Work if Necessary 

When planning your move, decide if you will have to take off work or not. While big cross-country moves will most certainly require you to take time away from work, you may be able to make a quick move across town or even down the hall on the weekend or your days off. If you do have to take time off work, make sure your budget can handle a smaller than normal paycheck or two. 

Save For a Deposit or Down Payment

When moving to a rental property, most landlords require a security deposit. Security deposits are usually equivalent to one month’s rent. If you purchase a property with a mortgage, you will have to pay a down payment. A down payment is a percentage of the total price of the property. Since these expenses may be hundreds or thousands of dollars, it is important to make sure you can afford them before you move out. 

Evaluate What Furniture or Appliances You Need

Before moving, think about what furniture and appliances you will need. While renters may not need to purchase devices like a fridge or dishwasher, they may have to buy furniture like couches or a dining table. On the other hand, homeowners may have to purchase virtually everything, including all furniture and appliances.  

Ways To Save Money When You Move 

To save money on the moving out process, try these helpful tips! 

Save on Movers by Asking Friends or Family to Help

Instead of paying movers to help with your transition, ask a few trusted friends or family members. As a thank-you, perhaps purchase lunch or dinner for your helpers. 

Move Slowly Over Time

If you have the time, you can also move yourself in small installments. Instead of having one big moving day where you transfer everything, move your stuff slowly over time. If your new place is a stop along the way in your daily commute, you could drop a few things off each day on your way to work! 

Get an Easy Loan if Needed

A quick personal loan can be a major financial help during a move. While you want to stay away from predatory options like payday loans online same day, there are convenient credit builder loans that can help you get the money you need as well as help improve your overall finances! 

References:
Average Rent Report: June 2022