Many young people postpone leaving their parents’ homes due to the high cost of living. There are those who postpone the transition to finishing their degree and finding an organized job, and there are those who are in no hurry to move even then. Often, it is indeed smarter financially.
If you can’t stay at your parents’ home, or if you just feel it’s time to spread your wings and leave the nest, but are worried about the financial consequences – here are some rules of thumb to help you assess whether you’re ready to run your own household:
When searching for an apartment, you should focus on the apartment in which you want to live for the long term – and it is desirable that this will also be possible for you. It is not recommended to rent an apartment for “in the meantime”, until the trip after the degree you are planning or until you finish your internship and then you will already see. The cost of moving includes economic costs in themselves, which can be avoided in this way.
Rule One: Do you have a steady source of income?
The high rental rates in recent years, especially in the Gush Dan region and in the center of the country, do not allow many good people to rent any apartment they want. Therefore, make sure that your income matches the expected living costs and before you move to the other end of the country, check what employment opportunities there are and what you will make a living from. Look for a regular, ongoing source of income. The general recommendation is that the amount of rent should not exceed one-third of income.
Rule Two: Estimate in advance the payments you will have to pay
Bills – It’s difficult to estimate total bill payments, especially if you’re moving to a new area or paying bills for the first time. To make a rough estimate, ask people whose lifestyle is similar to yours – most people with a similar work routine to yours will use, more or less, the same electrical appliances, and receive similar electricity and water bills. Round up the amounts given to you. Pay attention to bills that are not fixed throughout the year (e.g. electricity bills: heating in winter and air conditioning in summer), and those that remain more or less constant.
Shopping Cart – To calculate the cost of your monthly shopping basket, go to the website of one of the supermarket chains and assemble an average weekly shopping basket. The basket will consist of basic consumer goods and perks that you will allow yourself from time to time. Don’t forget to include cleaning and hygiene products, even if they are purchased less frequently.
Rule Three: Set Your Priorities and Lifestyle
Once you’ve calculated your rent, economy, and current bills, you need to decide what your lifestyle is and how much it will cost you.
Do you own a car? Purchasing a monthly pass? Would you like to connect to a cable or internet plan? What about gym memberships?
Think about all the expenses involved in a lifestyle like yours, even those that seem small and negligible – periodic visits to the dentist, a monthly trip to visit Grandma in the north, a haircut or face you treat yourself, and fashion accessories and gadgets that you “must” buy from time to time. All these small expenses tend to add up to not small amounts and not negligible at all.
You should save money on the side that will be used to finance things you buy “once in…” Your friends have decided to get married and you need money for a gift, a toothache that suddenly requires a very expensive treatment, the test of
The car that arrives every year, the vacation you plan to take soon or in the long term, and any trouble that doesn’t come.
Fourth rule: Buying furniture? Think long-term?
Moving to the first apartment is usually more expensive than moving to the next apartments. If you are not moving to a fully furnished apartment (which most apartments are not), take into account furniture expenses and basic primary equipment (e.g. a sponge set). Use discretion in these purchases as well – it is recommended not to invest in expensive or built-in furniture (“billet-in”), and it is better to choose furniture that can be easily transferred to the next apartment and the next one, without compromising its quality (for example – a bed that can be dismantled).
In conclusion, it is recommended to prepare a table or Excel file for calculating all expected expenses, compared to income. Only then will you know if the costs are realistic for you, and if you can cover them.
Don’t be tempted to rent a dream apartment that doesn’t match your financial ability. Statements such as “we’ll manage”, adopting an ascetic lifestyle, relying on savings, working extra in the evening, or all four together, will lower, at best, the quality of life, compared to what you are used to with your parents, and in the worst case (but no less common) will return you to your parents’ home, only without the savings.