Have you heard that how much you pay for your living arrangements should be about 28% of your income? It’s a fairly common piece of advice, but it isn’t always the most accurate way to determine whether you can actually afford the rental prices on that apartment.
Here are a few other things you’ll want to consider before you sign a lease on your dream apartment.
Unfortunately, you may be misled as to how much you can actually afford, thanks to your debt. Even if your income is high, if your debts are high too, you’ll definitely have to think hard about whether that apartment is really the right choice for you.
Many young people have tens of thousands of dollars in student loan debt. Credit card debt and car loans can increase debt to hundreds of dollars a month.
When calculating the rental prices you can afford, take your debt into account. This handy calculator allows you to add expenses so you can truly see what you can afford.
Everyone’s got a few must-haves. From a daily stop at your favorite coffee shop to monthly trips out of town with friends, there are likely things that you spend money on that you aren’t willing to compromise.
These items should definitely be added to your list of expenses. It’s really easy to overlook that $3 cup of coffee every day, but that could add up to $60 or more dollars every month!
Don’t forget to save!
Just because you technically have enough money for everything doesn’t mean you do. Make sure you have enough left over every month to save!
Don’t get ahead of yourself and end up with an apartment you can’t afford. By carefully considering your financial situation, you can find a wonderful apartment that doesn’t leave you with an empty bank account at the end of the month.