There’s no question that renting presents a financial challenge for some millennials. If you’re considering making the leap to renting for the first time, weigh your options carefully by taking these steps. Preparing in advance will make you a happier renter – and lead to long-term savings.
Know your credit rating. A landlord can and will consult your credit score before approving your lease. Before touring apartments, ensure your credit is good standing. Any discrepancies in your credit history can cost you your dream digs.
Have some money in the bank. If you’re serious about renting, save up at least three months worth of living expenses before moving in. Depending on your landlord’s policy, this will cover a security deposit or first and last’s month’s rent, as well as any unforeseen expenditures.
Shop within your budget. Stick to rentals that your budget can reasonably accommodate. Financial experts recommend spending no more than 30 percent of your monthly income on rent, but that’s not always a realistic number, especially in big cities. If you live in a high rent area, bump up your percentage to no more than 50 percent.
Factor in household items. Many first-time renters forget that everything in the apartment must be financed by their income, including small items such as toilet paper and garbage bags. Budget for household necessities, and while you’re at it, factor in renters insurance, too.
Stick to basic big ticket furniture. When you first start renting, avoid the temptation to furnish every square inch of your apartment. You only really need three things: a place to sleep, a place to sit and a place to eat. Other furnishings can come later, after you’ve established a workable monthly budget.
Learn to grocery shop. Instead of going out for meals or ordering takeout, spend some time in your local grocery store learning sales schedules. And get yourself a cookbook – preparing your meals on your own will save you hundreds in food costs each year.
Reprinted with permission from RISMedia. ©2015. All rights reserved.