So, you’re 20 years old, earning $18 an hour, and you’re wondering, ‘How can I afford $1000 a month rent?’ Well, you’re in the right place! Let’s break it down and see how you can make it work.
Let’s talk about the general rule of thumb when it comes to rent affordability. It’s commonly suggested to budget 30% of your gross monthly income for rent. So, if you’re making $40,000 a year, that’s about $3,333 a month. Thirty percent of that gives you just under $1,000 for rent. Sounds doable, right?
But wait, there’s more to consider. What about your debts? Student loans, car payments, credit card debt – they all factor into your financial situation.
The 30% rule is a general guideline, but may not be suitable for everyone. The amount you should spend on rent depends on factors like your income, where you live, expenses, debts, and financial objectives.
To manage your finances better, review your spending and saving habits from the last three months. This will help you identify areas where you are spending too much. Follow these steps to determine a suitable rent amount.
- Figure out how much money you’re bringing in
Just add up all the cash you’re making from your job, side hustles, and any other help you’re getting (like alimony, child support, or government aid). - Add up all your spending (except for rent or housing)
This covers everything from groceries and getting around, to fun stuff, family outings, meds, childcare, and other costs. Sort these expenses into groups, like “must-haves” and “nice-to-haves,” to see where your money’s going.
- Figure out all the extra costs and one-time expenses for moving. Apart from considering your monthly rent budget, make sure to also include hidden or one-time costs related to moving. This could involve expenses like hiring a broker, paying for movers, application fees, credit checks, security deposits, and buying furniture.
Affording a $1,000 a month rent on an $18 an hour wage at 20 years old is definitely possible. It just takes a little bit of budgeting, planning, and maybe some creativity. But with these tips, you’ll be well on your way to finding the perfect apartment that fits your budget.
Related posts:
How Much Rent Can I Afford? – Rent Affordability Calculator | Redfin
