Essential Guide to Budgeting Your First Apartment

in Renter Life

Renting out your first apartment is usually an exciting time in one’s life – you will be making new decisions, doing things alone, and be more independent. However, it can, of course, be stressful because you have to make sure everything is safely packed so nothing gets broken and properly labeled so that you always know where’s what. Also, let’s not forget about organizing the moving and finding a reliable crew or just a vehicle to transport it all. 

Although you may think that all major things are taken care of once you finally unpack and settle into your cozy rental, that is not exactly the case. For those who are new to all this, there are financial matters that are waiting for you impatiently so here is a guide to help you cope with them the best you can.

Make a list of living expenses

To know what you are up against, you need to make a list of the things that you need to have money for. One of the most obvious expenses is the rent and you would have to pay it on a monthly basis (unless you come to a different arrangement with your landlord). The electricity bill is most often the second biggest item on the paying list and it’s the tenants that usually cover it. When it comes to gas, it is often paid by the landlord, but of course, you have to check that with your landlord.

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Besides gas, landlords pay the water bill as well but in some rare cases, they might ask you to tend to it. While the internet has become a must, the cable is not so much popular with the younger generations so you would have to consider whether to get a package that includes both cable and internet or get them separately. Of course, it is possible that your landlord already has a package in which case you don’t have much say about the prices. 

Reviewing your financing options

Once you know the basic elements that you need to cover, it would be easier to assess whether your current financial state can cover for it without a problem on a monthly basis. If it can, that is excellent but most people cannot say the same thing. While some people borrow from their family and friends, others are well aware that something like that can ruin a good relationship.

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This is why, for the sake of staying on speaking terms with your grandmother, it is best to seek financial help elsewhere. For instance, taking out a personal loan can just be the perfect cure for first and last month’s rent, security deposits, moving fees, parking fees, etc. When it comes to the type of loan, you would most probably need an unsecured personal loan that doesn’t need collateral.

Consider taking out insurance

Another notion worth considering is insurance, precisely because it is the last thing on anyone’s mind – until something happens which requires it. Floods, fire, burglary are not that uncommon and although most landlords have insured their rentals against such problems, it may come as a surprise to you that your personal belongings as a renter are not protected by their policy.

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This is why many landlords insist on renters having renter’s insurance that would protect their personal property within the rental property. Therefore, it’s better to set aside some money now then to regret it later when the losses are significant. Another element you should be considering when choosing the provider is whether the insurance policy protects against losses resulting from liability claims. Also, additional living expenses coverage comes in handy in case something happens which forces you to temporarily live somewhere else.  

Keeping the costs low

However, it may happen that after a month or two you conclude that the rental in question it too much of a financial burden and that you may have to move. The second time around, you should be thinking about some other elements to be able to make a wiser decision and avoid losing money in the moving process. For example, you may reconsider the size of the apartment and move on to something smaller, like a studio or a basement apartment.

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When it comes to location, chances are that a rental close to the city center will cost more than one in the outskirts of the city. However, finding a place far away from where you work also means that you will have high expenses when it comes to transportation so in this case, it is best to find a middle ground. Of course, it may happen that you might still get a perfect place at a perfect location but that you will have to share it with one or two roommates — which is when you think about it, an economical agreement. 

Wrapping up

Well-equipped apartments are not necessarily expensive and not all rentals on the outskirts of the city are cheap. A decent price and quality furniture and appliances are indicators of a good deal and if you combine them with a good location, you get a perfect nook. And if you are mindful of your finances, you will be able to live happily in this nook for as long as you wish.

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