It’s estimated that approximately 42.58 million housing units are occupied by renters in the United States. If you are thinking of becoming one of those renters, you might be worried or feeling afraid that you won’t be able to make ends meet. In this economic climate, your fears are understandable.
For many individuals, one paycheck makes all the difference. In the U.S., bankruptcy is a choice between Chapter 7 and Chapter 13. In 2020, 381,217 Americans filed for Chapter 7 bankruptcy, and 154,341 Americans filed for Chapter 13. You don’t have to be one of them. All you need is a budget for your new life and the mindset that you are going to stick to it. It’s not as hard as you think. Take notes on these tips on how to create a budget and start feeling better about your new home and your new adventure today.
Budget Essentials First
When you’re moving out on your own for the first time or if you’ve just been discharged from military service using your DD214 form, you need to put a basic financial plan in place. Put essentials like food and housing first on your budget. These are the must-haves that you need to factor into your monthly expenses.
A budget is defined as a plan for the coordination of your expenditures or expenses. In other words, you know how much money you have and you know what your expenses are going to be. Now you just need to plan how that money is going to be spent and you will see quickly where you can save money.
Look at how much you know you have every month, and subtract your food and housing costs from that dollar figure. From there, you know how much you have to spend on other costs throughout the month. However, you’ll want to give yourself some breathing room for unexpected financial issues so that you don’t find yourself in a money emergency.
Food Budgeting Tips
You might be feeling pinched already. See what you can trim here to save money on this budget line. Do you eat out a lot? Groceries are less expensive than food deliveries or eating out. Keep restaurants in your budget if you can, but start looking at grocery costs and you will see some numbers whittle down in your favor. If you turned your restaurant costs into grocery money, you will get a lot more food out of it.
For example, a twenty-dollar fast food bill can purchase your bread, flour, milk, eggs, and coffee in a lot of areas. If you are really stuck, learn how to make pancakes and you have your food bill met until you find more room in your budget. Increase your food budget to $25 and you have pasta and sauce for dinner for the week instead of one meal from McDonald’s. Learn to master some basic meals that you can prep for the week and you’ll eat well while staying within your budget.
Utilities Budgeting Tips
If you have a home or apartment, water and electricity are essential items. Pay for those before you get the most expensive cable or streaming package from your telecommunications provider.
If you aren’t sure how much your utilities are going to be, call the electric or water company to find out how much the previous tenant spent. When you put those numbers in your budget, you will know how much left you have for internet and television. Of course, internet may be a necessity if you work from home. Be sure to compare local providers and see how you can secure a better deal on the access you need.
Most of the time, these are fixed costs — like car insurance premiums, loan payments, parking costs, and more. What you might not be aware of are gas costs. Add the amount you spend on gas into your budget and err on the side of caution to account for changing fuel prices. If you have a little room in your budget, add repair or emergency expenses here. One car repair can ruin your budget for the month. When you save money on other budget items, put it into a transportation fund or emergency fund.
Breathe Better with Budgets
It won’t take long after you get the basics of budgeting down to begin feeling better about where you are headed. Congratulate yourself for moving out on your own. Breathe. It’s going to be okay. With these tips in mind, you’ll grasp some basic financial literacy and create a lifestyle for yourself that can support your monetary goals.