Living alone can be liberating, but it comes at a cost. With no one to split bills with, expenses like rent, groceries, and utilities add up quickly. Depending on where you live and your lifestyle, the cost of living alone can vary significantly. We will explore the expenses you need to consider and provide some tips for budgeting and making the most of your solo living experience.
How Much Does It Cost to Live Alone?
While living with your parents may be comforting, at some point, it’s time to move out and start living on your own. Unfortunately, living alone can be expensive, even in places where rent is affordable. To figure out if you can afford to move out, you need to consider more than just the monthly rent cost.
There are other expenses to take into account, such as utilities, subscriptions, food, furniture, laundry, and transportation costs. For example, the total cost for the first month could be around $3,380, including rent, security deposit, electricity, subscriptions, food, and furniture.
After that, you can expect to pay around $1,730 every month (not including personal expenses). It’s crucial to take these costs into account before signing a lease and moving out on your own.
What Are the Different Factors That Will Affect the Cost to Live Alone?
When considering the cost of living on your own, it’s important to start with your regular monthly expenses. Rent is typically the most expensive expense for most people, but other factors can influence the cost. The location you choose to live in plays a big role in how much you will pay for rent, with bigger cities typically having much higher average rent than small towns.
Additionally, the type of dwelling you choose will affect the cost. There are many options, such as houses, apartments, mobile homes, duplexes, and condos. Ultimately, the cost of rent or mortgage will depend on the location and type of dwelling you choose.
It’s essential to take these factors into account when calculating how much it will cost to live on your own.
When living on your own, it’s important to keep in mind the various utilities you’ll need to pay for in addition to your rent or mortgage. Electricity is essential to powering your lights and appliances and can cost an average of $122 per month.
The amount you pay will depend on your electric company’s rate and your usage, which is influenced by the size of your residence and how many things you have that use power. You should also budget for water and sewer expenses, which can range from $18 to $70 per month, depending on where you live.
Gas is another utility that may be necessary for heating and cooking, and the cost will vary based on location. It’s important to consider these expenses when calculating the overall cost of living alone.
One of the most important things to consider when living on your own is your food budget. Depending on your habits, this can significantly impact your overall cost of living. Many people move out without knowing how to cook or grocery shop on a budget, leading them to rely on takeout or dining out frequently.
While occasional takeout isn’t terrible, it can quickly add up to hundreds of dollars each month. To keep your food budget in check, try to learn how to cook a few meals and limit eating out to just a few times a month or once a week. With this approach, you can keep your food budget to just a little over $100 a month.
When living on your own, transportation is essential to getting around. How you choose to get around will depend on your individual circumstances. Biking can be a cheap option if you live close to your destination and are able to bike there most of the time. Carpooling is also an option that can save you money.
If you live in a city, public transportation may be the best choice. The cost of public transportation will vary depending on the type you choose and how frequently you use it. If you own or are buying a car, you will need to factor in the cost of gas, insurance, and maintenance.
It’s important to consider all of these factors when deciding on your transportation options.
When you move out on your own, it’s important to have insurance to protect yourself from unforeseen events. If you have a car, you’ll need to purchase auto insurance which can cost around $100 per month for people under 25. You may be able to stay on your parents’ policy, so compare the prices and see which one is cheaper.
Health insurance and renters insurance are also important to consider. If your parents have a health plan, you may be able to stay on it until you reach a certain age. Renters insurance is not required by law, but your landlord may require you to get it.
For just $20 per month, you can protect yourself from covered losses such as a fire breaking out in your home, which your landlord’s insurance may not cover your personal belongings.
Internet and Phone Bills
Nowadays, cell phones and internet access have become an essential part of our daily lives. Whether it is for work, communication, or accessing important information, we rely on these technologies. However, it doesn’t mean that you need to spend a lot of money to get a good plan.
While some people pay over $100 a month for an extensive plan, it is not necessary to have all those bells and whistles. You can find a decent plan that fits your needs for less money. Do your research, compare different plans and providers, and choose one that offers what you need at a reasonable price.
Savings and Investment
While saving and investing may not be considered necessities, they are essential for securing your financial future. Even a small amount of $5 a week can make a significant difference over time. It’s never too early to start planning and saving for your future, especially now that you are living independently.
The first step in saving is to open a savings account. This allows you to keep your money secure while earning interest on it. By creating a habit of saving, you can build up a rainy-day fund and prepare for any unexpected expenses that may come up.
Living on your own comes with a lot of monthly bills and some additional one-time expenses. You have to be aware of these bills and decide if you need them or if you can cut them out. Some of these bills are not necessary, such as cable, subscriptions, gym memberships, and entertainment. If your bills add up to too much, you can easily cut them out.
There are also some one-time expenses when you first move, such as moving costs, deposits, furniture, and appliances if your place is not furnished. You should budget accordingly and determine what you can afford to spend in each category to ensure that you can comfortably afford living on your own.
How to Save Money While Living Alone?
Moving out on your own can be exciting, but it also means you’re taking on more responsibilities. As you’re busy with decorating your new place and shopping for new home essentials, it’s easy to overlook important tasks such as paying your utility bills on time.
To avoid getting into trouble, here are some helpful tips to ensure you stay on top of your bills.
Learn Your Expenses
Creating a budget is crucial when moving into a new place. Your budget should include all your expected expenses, such as rent, utilities, groceries, transportation, and insurance. Creating a budget helps you to manage your finances and ensure you don’t overspend.
When it’s time to pay your bills, make sure you prioritize rent payment since it is the most important payment to make. Paying your rent on time will ensure that you have a roof over your head and won’t get evicted.
Set Up an Automatic Payment
Setting up automatic payments can help you avoid missing payments or falling behind on bills. You simply authorize the bank to transfer a specific amount of money to the vendor on a regular date, such as the 15th of every month. This way, your bill payments are processed without you having to do anything.
However, keep in mind that automatic payments only work for fixed costs that don’t change from month-to-month, such as your internet bill. Additionally, it’s crucial to ensure that you have enough funds in your account on payment day, or else you may be charged an insufficient funds fee by your bank and interest by the vendor.
Learn When to Say No
Living on your own in a new city can be both exciting and challenging, especially when it comes to managing your finances. It’s tempting to go out for dinner, coffee, and drinks with new friends, but these expenses can quickly add up and leave you struggling to pay for essential costs like rent. To avoid this, it’s important to be strict with yourself and know when to curb your spending.
If your bank account is looking low before rent is due, consider inviting your friends over for a cozy night in instead of going out to a fancy restaurant. Remember that making small changes can make a big difference in your overall financial stability.
Manage What You Can
When you start living on your own, you’ll find that some expenses, like rent, will remain constant. However, other costs, such as your utilities, will vary based on your usage. This means that if you use a lot of electricity or heat, your bill will be higher. It’s important to be mindful of your usage to avoid surprises on your bills.
For example, you can try to turn off lights when you’re not using them or wear warmer clothes indoors instead of turning up the heat. These small adjustments can save you money in the long run. Additionally, you could consider hang-drying your laundry instead of using a dryer to cut down on your weekly laundry costs.
Remember, controlling the costs you can is key to staying on top of your expenses.
Make Your Living Expenses Work for You
Paying your bills is necessary to keep the essentials, like shelter and food, but you can also take advantage of them to get some rewards. One way to do this is to use a rewards or cash back credit card for recurring bills, such as heating, water, and electricity.
It’s important to make sure to pay the balance off every month to avoid interest charges. With a cash back card, you’ll receive a certain percentage back on purchases made with the card, which can then be used for statement credits, gift cards, and more.
By putting your utilities and groceries onto the card, you can earn money back on bills you already have to pay.
Living alone can be an exciting and liberating experience, but it comes with financial responsibilities. By creating a budget, controlling expenses, and utilizing money-saving techniques, you can live comfortably and avoid financial stress.
With proper planning and discipline, living alone can be a fulfilling and rewarding journey.