That means if you earn $3,000 per month, your total housing costs should be $900 or less, including the cost of utilities.Īs housing costs become more and more expensive compared to income, sticking to the 30 percent rule can be tricky, if not impossible. That means if you’re looking for an apartment that’s $900 per month, your landlord will want to see an annual income of at least $36,000.Īnother guideline that can be helpful is to try and limit your total housing costs to under 30 percent of your total income. Ideally, your annual earnings will be at least 40 times your monthly rent. One way that landlords and property management companies determine if a potential tenant can afford an apartment is to look at the person’s annual income. Often, you won’t be able to rent a place unless you have a certain amount of income. Since housing or rent costs tend to eat up so much of your budget or income, it’s important to have a good grasp on what you can afford before you sign a lease. Those expenses might include a weekly or monthly pass for public transportation or the cost of a car payment and gasoline. Transportation: Unless you live in an area where you can comfortably walk everywhere, you’ll need to budget for transportation expenses.Your expenses will be lower if you buy drugstore products or store brands or higher if you need to buy department store brands. Like food, the amount you budget for health or personal care depends on your preference. Health/personal care: If you take medication regularly or just need to buy shampoo or soap, you should leave room in your budget for it.A female between the ages of 19 and 50 might spend $164.20 per month for food on the “thrifty plan” or as much as $326.70 per month on the “liberal plan,” for example. The USDA has food cost recommendations based on sex, age and preferences. How much you spend depends on your dietary preferences, though. Groceries: You need to eat, so there’s no way to avoid the cost of food as part of your budget.The cost of a phone plan with unlimited data might be anywhere from $55 to $75 per month depending on the carrier. The average cost of a broadband internet connection is around $55. How much you pay for it depends on what you end up purchasing. Internet/phone/cable: It’s difficult to get by without some sort of connection these days, which is why internet/phone/cable is in the necessary expenses category.Renter’s insurance policies are often fairly inexpensive, ranging from $15 to $30 per month. The exact amount you’ll pay is based on how much coverage you have, your age and whether or not your employer chips in (in the case of health insurance). Insurance: Necessary insurance can include health insurance, auto insurance and renter’s insurance.The cost of your gas, electric or water bill depends on a variety of things, including how insulated your apartment is, the weather near your home and how energy efficient your appliances are. Utilities can include your gas bill, electric bill, and water/sewer bill in some instances. Utilities: When you’re a renter, some utilities might be included in the monthly cost of rent. Housing is often the biggest living expense people have each month, though how much you end up shelling out for a house or apartment depends in large part on where you live.
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