Essentials to Include in your Monthly Budget
If you’re a first-time renter and not entirely sure of your financial situation, it might be best to draft a monthly budget to keep you on track. However, you don’t need to be new to renting in order to get on top of your finances. If you want a better overall look at your finances and where your money goes, write out a simple budget. Here are a few things to include to get you started.
Paycheck: Where your budget all begins. Take note of how much you are bringing in each paycheck.
Retirement Contribution: Investing in your retirement early on in your career is very beneficial, and can set you up for long-term financial health. Keep track of what you’re contributing here.
Savings: Any additional money you set aside for savings? Record that here.
Student loans and other debt: Attack those high interest loans ASAP.
Your largest monthly expense will likely be the price you pay to rent your apartment. Ideally, you are paying less than 30% of your monthly income on your rent. This goes back to the 50/30/20, which is a great place to begin when considering your budget. Not sure how much you should be paying for rent? Try our rent calculator.
Your utilities go a bit under the radar, but every month be prepared for those bills to come around. Know how much you are spending on each of the below.
Electricity: The cost of powering your home
Gas: Gas range stovetop or other gas appliances.
Water/Sewage/Garbage: These expenses are commonly covered by landlords and lumped into your rent price. Ask them if you’ll be responsible for paying these before moving in.
Internet/Cable: How much are your internet speeds and cable plan costing?
Phone/Data: Texting, calling, and surfing the web from your smartphone isn’t free. Especially if your phone isn’t paid off.
Groceries eat a large chunk of your income, so keep track of how much you’re spending here. Cooking from home is almost always cheaper than going out to eat, but it might be expensive getting all of the smaller ingredients needed to get your kitchen functioning. Factor in groceries, restaurant and alcohol expenses here.
Driving to work every day? Relying on public transportation to get you to and from? These costs stay pretty consistent as they follow your schedule. Factor in the cost of gas, car payment, car insurance, parking meters, bridge tolls, and public transit.
Subscriptions & Memberships
Amazon Prime, Netflix, Spotify, Hulu, Costco and a gym membership… it can add up really quick. Take note of all of these subscriptions and membership and do a quick audit to see if you are getting the most out of each of these. Haven’t turned on Hulu since Handmaid’s Tale ended? It might be a good idea to cancel.
How much do you have leftover after budgeting out all of these essentials? Spend a little bit on yourself. See a movie, take a weekend getaway… life is short.
Any monthly budget starts with these core expenses, so consider them first. If you want to get even more ahead of your finances, try checking out some of these great budgeting apps to give you a better sense of where your money is going.