Yes, that time has finally arrived. You are moving out.
You are ready to move into a place of your own and make one of the biggest transitions of your life, and you might be wondering where you should begin.
Independence surely feels great but savouring that newfound freedom can be more expensive than you might think. Luckily, there are tons of helpful mobile apps, websites, and online budget calculators that can make managing your finances less daunting and enjoyable.
But as easy it can be to get carried away with dreams of not competing with a curfew and living on your own – the reality is that moving out is a greater challenge than you’d think and a major achievement simultaneously. We are not trying to dissuade here, but rather prepare young adults moving out for the first time, to be more responsible and face the hardships of transitioning from mom and dad’s home to their own apartment.
1. First Things First – Figure Out How Much Rent You Can Afford
Typically, the biggest hurdle to moving out that adults face is being able to get their first flat. Apartments can be quite costly as well as the necessary supplies to furnish a home completely. Not to mention that it doesn’t even include moving costs.
First, you will need to assess your income. How much do you bring in every year, with any salary, interest, dividends, support, or other means of income included? Normally you should expect to spend nearly 60% of your budget on the top three items such as transportation, housing, and food. Avoid exceeding this number, as you will also need money for emergency funds, entertainment, credit card payments, and retirement plans, insurance, and all of your other monthly expenses.
Moving expenses should not be excluded. Even if you cut back on as much as possible, you will still face costs associated with your move. You should save up enough to cover your first month’s rent as well as cover the security deposit on your new apartment.
Expect the unexpected when moving out of your parent’s house.
For one, you should save for and consider the inevitability of surprises.
No one loves unexpected expenses, neither do you, so it’s best to be prepared for them. Save up as much as you can -$240 is an ideal amount to shoot for, but more is always better.
2. How Does Your Credit Score Look Like?
If you’re just moving out, there is a small chance that you will have an established credit score and history. Typically, we can establish a credit history when we utilize credits, take out loans, or have overdue bills that companies report to a credit bureau.
Your credit score can have a huge impact on your quality of life, from what car you will be able to drive to what kind of apartment you can get. If you never had a credit card, the best thing you can do is to start with a secured credit card to make payments on time and keep your credit score under control.
If you have a student or a car loan payment due monthly, then paying that on time will also help improve your credit score. But pay attention because you will need to check your credit score every year while putting effort into building your score. If you notice your credit score is determined wrong – for instance, if your credit report states that you lost a payment that you’re certain you made – don’t let it unreported.
3. Will You Need a Co-signer or Guarantor?
When you’re moving out and don’t have any income to impress your landlord and lack an established credit history, it can be challenging to convince someone to rent to you. But a guarantor or co-signer might convince your landlord to rent to you.
A co-signer will sign the lease agreement and usually agree to cover the rent cost, whether inherently or explicitly. Although these two terms are often used interchangeably, a co-signer normally has to cover any debts left by you, whether the co-signer lives there or not.
4. Narrow Down the Location
Moving out is actually the easy part. Choosing where to move is where things get difficult.
With a myriad of options available, it can be challenging to choose where you will live for the next couple of years or even for the rest of your life.
Wherever that place might be, be sure to consider the commute time to a common location. These can include the grocery store, work, loved ones, school, and wherever else you spend most of your time. No one wants to live inaccessibly far from these places. But if you have sufficiently reduced your options to a single town or city, you can make final decisions regarding the neighborhood in which you’d love to live.
What do you need from your neighborhood? Better shopping options and proximity to important locations such as monthly parking downtown Denver, or better public transportation? Once you make your final decision, then you will be able to start the most exciting part: the apartment hunt.
5. Check the Place Out
Once you’ve picked your best option, it’s crucial that you check everything out, which means that you should make a record of any potential damages left by ex-tenants. Why? Because having this proof before you move in will make the difference between receiving your security deposit back and when you move out or not.
When you eventually move in, your checklist can be linked to the condition you’re living everything in. This will bring all the proof you need that you aren’t responsible for nicks in doorways and nail holes you never caused.
A moving out experience might seem overwhelming because it is so. However, with a little planning, saving, and patience, you will be fully equipped for adult life. With your first credit card and now an apartment, you‘re going to be ready to face the world.