7 Factors to Consider in Setting an Apartment Budget

Having an apartment of your own is exciting, and part of maintaining your apartment is setting a budget. Keeping up with the costs of living, including your rent, utilities, groceries, and more ensures that you are stable and can help prevent you from falling into poor financial situations that could affect your housing situation, credit score, and more.

Read on to learn the seven factors you should consider when setting an apartment budget!

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1. Rent: The first and most obvious factor to consider in budgeting for your apartment is the cost of rent. If you have a 12-month lease, the cost of rent will remain the same every month until it is finished. The cost of month-to-month leases, on the other hand, can vary from month to month and is up to the discretion of the landlord/property manager. Rent costs are typically affected by a number of factors, such as location, housing type (apartment, condo, single-family home, townhouse, etc.), added amenities, and more. Rent is arguably the most important expense when putting together a budget for an apartment, and should be weighed the most among all other factors.

2. Utilities: In some cases, utilities can be included with the cost of rent, but these costs can also be paid separately. Utilities typically consist of expenses like electricity, water, heat, natural gas, heat, and more. Utilities typically have a flat base rate and the cost is based on usage, and depending on the frequency of your usage, your bills can be high or low. As you evaluate your budget, try to estimate the average cost of your utilities each month based on either your prior usage at a previous residence or calculate your estimated costs with a budgeting tool.

3. Internet/Cable: In today’s world, the internet is a necessity to navigate communication with other people, workplace tasks and responsibilities, casual browsing, and streaming devices. Internet plans are priced by megabit speeds per second, and the greater the speed the faster the internet. In addition to the internet, cable can also be another expense, and the two are typically bundled together and slightly discounted when bought together. Like internet plans, cable plans can vary by tier, and are priced according to different channel offerings and packages like premium channels, sports, etc. Depending on what you are looking for, these costs need to be factored into your budget.

4. Groceries and Toiletries: Food is an essential part of all of life and unfortunately, it does have a cost. Depending on your diet, your eating habits, and your inclination to eat fast food or dine out, your cost of food can vary. Microsoft estimates that the average cost of food per month for one person is between $212 and $405, which is a significant extra cost to factor into your budget. Paying attention to sales, shopping store brands vs. private brands, and utilizing discount grocery stores (if available) can help alleviate the cost of food. Toiletries should also be a factor in your budget, as items like paper towels, toilet paper, toothpaste, shampoo, etc. are basic necessities as well.

5. Subscriptions: Entertainment subscriptions are common nowadays. From Spotify to Max, there are a variety of viewing and listening options at your fingertips, which can definitely add up your monthly budget cost. With subscriptions, many of us have them but don’t actively use them. If you use subscriptions, be sure to have an idea of the cost of each one to create an accurate budget. If you have some that you don’t use, cut down on your monthly bills by canceling your subscription plans. Doing so will add money back to your wallet, and if you decide you want to try the subscriptions out again, you can always renew.

6. Insurance: Renters insurance, car insurance, and health insurance are common costs that are a part of everyday life. Renters and health insurance premiums are usually paid on a monthly basis, while car insurance can either be paid in full or in monthly increments. Depending on what type of insurance you have, the cost can be factored into your monthly budget.

7. Memberships: Membership costs can cover a lot of different areas, but can typically include gym services, a store membership (like Costco, BJ’s, Sam’s Club), and more. Gym services are paid on a monthly basis, and store memberships can be paid either in full for a year or per month. If you’re someone that enjoys going to the gym or likes to shop in bulk, calculate the cost of the different services in your budget.

8. Loan or Credit Card Payments: Many of us have debt, whether from student loans or credit cards. Paying off loans and credit cards can either happen in full or on a monthly basis over time. If you have debt, incorporate the costs of your monthly payments into your budget along with other costs.

Creating a thorough budget can take some work, but the more accurate and detailed you are in doing so, the better off you will be!