Leslie’s Guide to Moving: Part 1 – Determining What You Can Afford
I am putting together a moving guide to chronicle my most recent move to a new apartment. The guide will include finding a new apartment, moving cheaply & efficiently, and adapting to a new lifestyle.
Before you can start looking for a new place to live, you need to determine what you can afford. You may desire to live in a certain part of town, style of apt, or have your own place, but before you can even get started looking, you should make a realistic budget to keep you within your means.
Signing the lease on an apartment then realizing the rent makes your comfort of living tighter than you’d like, is a recipe for credit card debt.
Yes, this entire guide will involve apartments – I’m just not ready for mortgages yet.
The 30% Rule
Take your current budget, or create a new one if you don’t already have one (but you should!) and start plugging in a few increased rent numbers. It helps if your budget can show you the percentage of your income.
The “golden rule” is that your rent should be no more than 30% of your monthly income. Start with that.
Put in a rent amount that equals 30% of your income into the budget. Now look at the rent prices for your desired living situation and see how that matches up. Higher? Lower?
Keep in mind that your lifestyle may change as well. If you move to an area with a lot entertainment options, restaurants, or 24 hour places, you may find yourself spending more on eating out than you are used to. Try to factor this into your budget!
Moving to a Higher Cost of Living
I have been working in New York City for the past year commuting an hour and twenty minutes from central New Jersey paying 13% of my income on commuting.
I decided in the beginning of the year that I wanted to move closer to or directly to the city. However, I also knew that there would be a huge difference in rent.
I immediately began toying around with numbers on spreadsheets, comparing living on my own to living with roommates.
Living Sans Car
The most important factor I had to keep in mind with this type of move, is that I would not need a car. So, the first change I made was to take my current budget (from January) and add up my car expenses.
EZ Pass: $25 (not monthly)
Car Gas: $120
Insurance: $154
That alone is almost $300 without factoring in any car repair/maintenance. That extra money can go towards my rent without noticing much of a difference.
Moving closer to work means commuting will be cheaper. Moving into the city will reduce my commuting cost by at least $200.
That is $500/month saved simply by moving closer to work and selling my car.
