Finance Globe

U.S. financial and economic topics from several finance writers.
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Moving Out into Your First Apartment

Moving out on your own is a big step towards independence, and means more freedom and increased responsibility. It's a good idea to begin preparation about a year before you actually do move, so you have a chance to save money for all the expenses related to moving into your own place of residence. Many have moved out on their own with very little advanced preparation, and while it is certainly possible, it's just more difficult to do it that way. Make it easier on yourself by planning and saving well enough in advance, before you set out on your own.

Consider these points when planning to leave the nest:

Income - Corporately-owned apartment complexes will require proof of income and a decent credit history. Many will approve a rental expense for about 30% of your gross monthly income. So, if you make $2000 a month, you can probably expect to be approved for a $600/month rent. If you have debts, such as credit cards, auto loans, or student loans, they will usually reduce the amount of rent you'll be approved for by the amount of your minimum monthly payments. Privately-owned and managed rentals tend to have less strict policies and are sometimes more flexible about income or credit history, but it often depends on the location of the rental.

Rent - You may have an ideal location already picked out, or you may still be searching for an area that offers rentals in your price range. Look in the paper for rentals, pick up those apartment magazines, and check the phone book. The apartment magazines are great for research, since they typically have location maps, great photos and detailed amenity lists. They are often also the more expensive rentals, since they have the budget for mass advertising. Privately-owned rentals in the same area can usually be found for lower rent, but it takes a little more effort to find them.

Deposits - Call the place you want to rent, or just call around and find out what is the norm in your town if you haven't narrowed down your choices yet. A security deposit and the first month's rent is pretty standard when you take the apartment. If you have a pet, be prepared for an additional pet deposit, and even the possibility of a slightly higher rent. Some rentals will also require an up-front payment of the last month's rent; this helps to reduce the landlord's loss from tenants who skip out before the last month of rent is paid. Also, check with your local utility companies to find out if they will require a deposit to turn on your phone, water, electricity, gas, or cable.

Furniture - Start saving for your furnishings, but hold off on buying them. Avoid buying your furniture before you actually rent your new place, even if you think you're getting a great deal. It's not worth paying for storage or cluttering up your parent's house to collect the furnishings for your apartment down the road. Your tastes may even change by the time you get your own place. Or, you may find that you bought more than you needed because the apartment is smaller than you planned for, or that you don't need some of it because the place has built-in bookshelves or a dining bar. You'll always find good deals on furniture if you look around; thrift stores, the classifieds, and garage sales are great to buy furniture at greatly reduced prices. Avoid going into debt or using rent-to-own stores. It's smart to go the cheap way to get the basics, and then upgrade when you can afford the nicer stuff.

Kitchen - All these seemingly little items will add up to a significant portion of your home start-up costs. It's a good idea to begin collecting these items from thrift stores and garage sales, or catch sales at discount stores whenever you find them; you can easily put them away in your closet or under you bed without adding much clutter to your current living situation. At a minimum, you'll need cookware and bakeware, cooking and eating utensils, dishes and glassware, knives and cutting board, kitchen towels, food storage containers, measuring spoons and cups, and spices. You may also need small appliances such as a toaster, blender, fryer, coffee maker, and slow cooker, depending on what and how much you like to cook. Wait on the microwave; many apartments have them built-in. You may want to take a tour of every cabinet and drawer in your parents' kitchen; the visual can help you write a list of everything you'll need in your own home.

Bathroom - You'll need bath towels and washcloths, a trash can, shower curtain, and a rug. Many of us prefer not to buy used bathroom items, and it's really not necessary to. Depending on your budget, you can outfit your entire bathroom, including towels, for under $100, or you can get the decorator look for about $200-$300 if you shop the discount chain stores. Luxury towels will be much more costly than budget towels, but you get what you pay for; luxury towels are bigger, thicker, more absorbent, and last longer.

Bedroom - Bedding can be a bit pricey, but go for comfort; a good night's sleep is priceless. Keep in mind that bedding for a king bed will cost more than for a full bed, something you may want to consider when buying your bed. Other than furniture, you'll also need some relatively inexpensive items. You'll at least need a lamp for your nightstand, an alarm clock, clothes hangers and a hamper. A full-length mirror will ensure you leave your new place looking your best from head to toe.

Laundry - Your new apartment may have the option of coming with a washer and dryer for a little more in rent. It's up to you whether the extra cost is worth it, but don't forget to put a price on your convenience. You may find it's worth paying extra if your alternative is to find the time to drive to a laundromat or hauling loads of laundry up and down stairs, and sit there and babysit your laundry while it is in the machines, from fear of theft. If you must wash at a laundromat, figure out how many loads you will wash a month, and how many quarters it will take to do it. Whether you'll wash at home or elsewhere, factor in the monthly cost of detergent, fabric softener, bleach, stain treatment. You may also need an ironing board and an iron.

Cleaning - You'll need a mop and broom, scrubbers and sponges, a vacuum, duster, toilet brush, plus cleaning products and dish detergent. A small stick-vac may be adequate if your apartment is not very large, and it can substitute for a broom, since they work well on floors. You can do without a mop if you have little flooring, and you don't mind cleaning floors by skating around on your used bath towels with a bottle of spray cleaner.

Safety - A fire extinguisher is a must; a relatively small fire can quickly grow to an out-of-control blaze if you don't have a safe way to put it out. And they're only about $15 or $20, so there's no excuse not to get at least one. You should also have a first aid kit in your apartment, including bandages, first aid ointment, and pain relievers.

Decorations - It's not your home-sweet-home until you put your personal touch on it, and that means you can get really creative if you want to. Look at your personal possessions before you go out and spend money on pricey artwork. You may be able to solve storage problems and decorate at the same time. Your prized trophy collection can decorate a room, your bike can make an interesting decoration on your living room wall, or your knick-knacks may find a special place in every room. You may have more decorations that you realize; put off these purchases until you have settled into your new place, and have acquired the necessary items first. Get decorations when you can see where you really need some pizazz.

Insurance - Renter's insurance is to protect your assets in the case of loss or theft. You may be setting out on your own with very little and think that you don't have much to protect, but it can be a costly mistake if something were to happen. Everything you own has likely been purchased over a long period of time, and the total value of all your possessions is probably more than you realize. Even if you only lost your entire wardrobe, it would be a serious set-back to replace all your clothing at once. Add to that a computer, stereo, TV, all your music and games, your kitchen stuff, sporting equipment, linens, furniture, decor - well, you get the idea. A fire in a neighboring apartment or a break-in can cause serious financial hardship if you don't have renter's insurance to protect your property.
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Wednesday, 21 August 2019

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