As a first time renter, is my budget realistic?

Submitted by Beachboo07 t3_10p8ue1 in personalfinance

Hi! I (23f) am moving out in May, 1 year post-graduation :) I am looking for some advice on my monthlybudget before pulling the trigger on signing a lease.

Rent: $1250 (my portion. Split with roommate)

Utilities: ~ $100 (my portion- estimate)

Car insurance: $120

Subscriptions: $20 (Spotify and prime)

Gym: $35

Student loan: $500

Savings: $600

Groceries: $400 (parents will be helping slightly so this is an estimate of the max l'd pay)

Gas: $150 (remote work so I don't drive too often- this ranges so an estimate)

Fun/misc: $125

Total: $3320

My monthly income is $3400, sometimes higher if I work OT. Please give me any recs or advice on my budget!

Edit: the rent is the lowest we can find without going into a bad area. It will be 2 young girls so we want to keep the area in mind … also need to be within 30-45 mins of our work so that limits our options

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DeluxeXL t1_j6ixyh6 wrote

> Savings: $600

What are you saving for?

Where?

In what form?

> Total: $3320

> My monthly income is $3400

Did you account for the taxes and benefits that are subtracted from your gross pay?

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Beachboo07 OP t1_j6iyibr wrote

$600 into a HYSA at 3.75%. I want to reach around $20k and then I want to start investing. I do have some money in my 401k, Roth and a brokerage but I stopped investing in order to put more towards my loans a few months ago. I’m saving as an emergency fund, even though it’s a bit higher than normal it eases my anxiety to have it on hand.

Yes, $3400 is the net pay after all taxes and benefits. I am currently on my parents dental and health so I’m fortunate to not pay that until I am 26.

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cmdrmcgarrett t1_j6iysut wrote

$1250 rent is this being split between you two already? If so, where are you living? Gold Coast.

You need to split this rent, groceries, and utilities between you two. Even if it is a 75/25 split because you make more. Be fair but if you have a roomie, no free rides unless you can really afford it. Looking at this, you need help. As I said even if she is working PT, she can contribute also.

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Beachboo07 OP t1_j6iz6s5 wrote

$1250 each. Lol a wish .. New Jersey. It is quite expensive here and limited on options unfortunately.

This list is all for me, but as I stated groceries and utilities may vary and those are the maximum for EACH. I doubt utilities will be $200 a month total, but am preparing for the highest possibility.

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cmdrmcgarrett t1_j6izznf wrote

Geez. Come to the Midwest. Some cities here are about $1500/mo for decent 2br in a decent 'hood.

$400/mo in groceries? Caviar? Just kidding. I am about $300/mo for single person. I do cook a lot and take leftovers for lunches tho

It is doable but a bit on the tight side. Might want to play with numbers between savings and other things. Like I said tho. Make sure this other roomie does not get over their head because if she has to bail, you cannot afford to solo it at $2500/mo rent plus rest.

Do your student loans have interest? If not, defer them to a bit less per month if possible. It there a time limit on them? ( Sorry, I am wayyyy da hell to old to remember or even have student loans so I dont know)

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Beachboo07 OP t1_j6j4say wrote

I wish lol .. unfortunately my office is in New Jersey and I have to go in every so often :/ hoping to get out one day.

I think I could work on my food budget .. but I like to eat healthy and enjoy cooking so I don’t want to restrict myself too much. I’ll have to test it out ..

The roommate has been a good friend for the past 5 years and she works full time. I’m not worried about her bailing but will definitely have a conversation beforehand about money and stuff!

I have 40k in private loans at 3.9%. Unfortunate but I’m accepted it and have a plan to have it paid off within 6 years maximum. My minimum payment is $275, but I do $500 to knock off a little more

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cmdrmcgarrett t1_j6j654a wrote

Excellent on paying the loans of asap.

I wish you all the best in your new endeavour(sic).

Hope all works out for you two. It really seems like you have everything planned out.

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Beachboo07 OP t1_j6j6eb2 wrote

Thank you! That means more than you know. I wish you the best as well :)

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snuffleog t1_j6j24pb wrote

I'm in a similar situation and it breaks down the same, except my "student loans" is a car payment. I think you have your head in the right place. Your fun/misc budget may be a bit low but try to lower that food bill to compensate. Door dash/uber eats will be your biggest enemy.

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Beachboo07 OP t1_j6j522i wrote

Love to hear about others in a similar situation. It’s tough out here lol. I’m probably going to delete those apps just so the temptation isn’t there! I know the fun/misc is low .. but I think it’s worth the sacrifice for a little and I’ll be living with a friend so I think I’ll be ok … I hope lol

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Temp-Name15951 t1_j6jafln wrote

Remove every payment method from every app then uninstall the app. If you happen to cave and reinstall, add payment method and order immediately repeat the above process. Eventually it becomes easier to just not.

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Beachboo07 OP t1_j6kqugf wrote

So smart. I don’t have many on my phone but I think Amazon prime May be next to go!… so tempting lol

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shadow_chance t1_j6j896b wrote

Budgeting conservatively is probably wise but $150 in gas for a remote worker sounds super high.

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Beachboo07 OP t1_j6kqp44 wrote

I agree - but sometimes I like to visit my family that live about 1 hour away! Def on the conservative side though

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ct-yankee t1_j6jizpk wrote

I think you've done a pretty good job. Glad to see you baked in savings, that is important. Focusing on an emergency fund is wise. i would not delay contributing to the 401k at work ...secure any match. Don't leave that money on the table.

If you have after tax holdings in your brokerage account, consider leveraging those to establish your minimum emergency fund, and pay down loans... ultimately that will free up some of your income/capacity.

If I was in your shoes, I'd start every dollar budgeting. Know every dollar coming in and where it is going out. Track everything. Even a coffee. That practice will uncover any surprises you may have about your own behaviors that you arent considering. It is easy to overlook grabbing a sandwich, stops for coffee, .

400 a month is a lot of money for a single person to spend on food in a month (especially if this is additional on top of what is supplemented by parents). Do you brown bag? Does this 400 include eating out? You said max so being conservative is wise at first but you don't have much wiggle room here. Be sure to have clear rules about spend and consumption of groceries with your roommate.

You may want to establish a sunk cost funds for auto maintenance and basic non-emergency wear and tear like wipes, tires, oil and filter changes, etc.

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Beachboo07 OP t1_j6krqwh wrote

Thanks so much! I do want to contribute again this year, I was just thinking that after moving out I want to have all the money possible in case of any emergency. I will contribute again at some point soon.

I not familiar with what you’re saying in that second paragraph …. How would that free up my income more?

I agree the zero-based budget is going to help me a lot. I’m going to start that this month so I can get a feel of my exact ranges. I think knowing this will ease my anxiety a lot lol.

Once I reach my 20k emergency fund, I’m going to start some sinking funds to focus on! I lucky and my dad helps with those things, but I still think it’s important to have that just in case

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ct-yankee t1_j6mxmwo wrote

>I not familiar with what you’re saying in that second paragraph …. How would that free up my income more?

If you have money sitting in a brokerage, and there is enough to finish your emergency fund and/or pay off a loan you have, then you will have more income that would have been going to build the emergency fund, or going to that loan, that you could deploy elsewhere.

In short, fewer of your incoming dollars would have a "job" when the emergency fund is done and the loan is gone. That is then free capacity.

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Beachboo07 OP t1_j6nj7dw wrote

Ah that makes more sense, thank you! I’m excited for this stupid loan to be gone .. it’s going to be such a relief. I can’t imagine how much I’ll be able to improve my finances when I can allocate that $500 a month to something else.

Thank you for your help on all of this I appreciate it a lot!

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