Spongebob saying,

So you're ready to move out on your own!

It's time for an apartment hunting adventure. Whether it's looking for a bachelor/bachelorette pad or moving in with roommates, there are key things you need to know about paying for rent and utilities.

Cost Of Living Per Area

Depending on where you want to live, it could cost you a pretty penny!

A map showing each US state's average annual cost of living

Costs of living include:

  • Housing

  • Groceries

  • Insurance

  • Transportation

  • Healthcare

  • Basic Services

Different states have different costs of living:

  • $100 in Ohio will buy you goods and services that would cost $112.11 in states at the national average price level .

  • The same $100 in the District of Columbia buys you only $85.47 of the national average .

Flaticon Icon Hot Tips!

  • Follow the 50/30/20 Rule for your expenses budget:

    • 50% for living expenses

    • 30% for hobbies & entertainment

    • 20% for emergencies & debt repayment

How Much Should I Spend On Rent?

You'll have to pay monthly rent to your landlord, so here are two rules of thumb for keeping your rent affordable:

Flaticon Icon 40 Times Rent Rule

Your annual salary should be 40 times your monthly rent .

Flaticon Icon 30% Max Rule

You can always cap your rent at 30% of your monthly income.

Flaticon Icon Hot Tips!

  • Use a rental calculator to help you plan your rental budget.

  • Have 2-3 month's rent saved up, as landlords typically ask for a 1 month down payment + first month's rent.

  • The 40 Times Rent and 30% Max rules don't account for taxes and your own personal financial situation, so make sure to factor those into your calculations.


If you make $40,000 per year, how much should your rent cost based on the 40 Times Rent Rule?

What Should You Know About Rental Applications?

An application form sticking out of a folder, with a stick note that says Photo by Kelly Sikkema on Unsplash

You'll need to submit a rental application before you get an offer to sign a rental agreement, as your landlord will want to make sure you'll be a good tenant.

Flaticon Icon Hot Tips!

  • Credit & Background Checks: have all personal information prepared (i.e. social security, etc.).

  • Rental History: your prospective landlord might ask for references from your previous landlords.

  • Proof of Income: have your latest pay stubs ready.

  • Co-Signer/Guarantor: find someone you trust who's willing to do this for you.

  • Apartment Application Fee: most charge between $30-$50 but may go up to $100.

  • Agency Fee: be sure to factor this into your budget if you decide to hire a rental agent.

What Utilities Do I Need?

Depending on your lease, you may need to set up some utilities (but ask your landlord for preferred providers and check your lease for more details):

Flaticon Icon Internet and Cable

  • This often comes in a subscription package with home phone options.

Flaticon Icon Water

  • Your fees will combine flat rates and consumption rates.

Flaticon Icon Electricity

  • You may have different rates according to season and time of day.

Flaticon Icon Natural Gas

  • This is used to supply heat to homes in many areas.

Flaticon Icon Security/Alarm System

  • Ask your landlord for permission to install one if you need it.

Flaticon Icon Trash Collection

  • Some municipalities require bin fees or only offer private collection services.

Flaticon Icon Hot Tips!

  • Utility varies by state and municipality — in some places, gas/electricity and water are included in a single bill.

  • You can set up autopayments with banks and utility companies so that you don't miss any payments.

Take Action

A woman looking scared, beside the text

Moving into your own place should be something to celebrate, not fear! You can manage costs with smart budgeting.

Rent + Utility Checklist:


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