Are you tired of living at home with your parents? Or perhaps you’re sharing with roommates and are craving some independence away from their annoying habits?
Living alone might seem like the perfect solution, but it comes at a cost.
With no one to split the bills with, or share any emergency costs, you’ll need to be 100% sure you can afford to live by yourself before you take the plunge.
This guide on how to afford living alone explains:
- The typical costs involved in solo living
- Planning for emergencies
- Affordable living alone tips
- How to organize your budget
You’ll find this advice useful whether you’d like to rent or buy a property to live in by yourself. Let’s get started!
Key considerations before living alone
Living by yourself is an attractive prospect as it puts you in total control of your budgeting.
If you’ve previously lived in shared accommodation, then you’ll know how annoying it can be to chip in for bills that your roommates have racked up. Or not have the final say when it comes to choosing energy suppliers.
Living alone allows you to take complete responsibility for the expenses you pay towards your accommodation and living costs. The downside? That it’s your responsibility alone, and there’s no second income to fall back on if things are tight.
How much does living alone cost?
So, first up, be warned that living alone can be expensive, although exactly how much will depend on where you’re based and the type of accommodation you choose.
But to give you an idea, the average renter living alone in America spends an average of $10,600 a year on rent. That’s approximately $900 a month.
Don’t be fooled into thinking that you’ll be living in a five-bed or even a two-bed property for this money. You’re more likely to find a nice studio apartment for your cash.
But we all know that rent isn’t the only outgoing expense you’ll commit to when you’re living by yourself.
Check out the following bills you’ll need to fork out for too.
- Heating – this might cost up to $100 per month depending on the efficiency of the building.
- Water (hot, cold, and sewer). Solo homeowners will always be responsible for this cost but tenants may have it included as part of the rent. Always check before you sign the lease.
- Electricity – this could range from $40-100 per month, usually at the higher end of the scale if you’re working from home.
- Gas – if you live in an older style of property, then you might use a gas cooker. The cost is reasonable, averaging around $20 a month.
- Laundry – if you don’t have your own washing appliances and the building you’re in doesn’t have a laundry room, then a laundromat visit can cost $6-12 per load.
- Insurance – homeowners and tenants will both need content insurance to cover possessions. Homeowners will also need to pay for building insurance.
Saving for an emergency
Emergencies present themselves in various ways, especially during the pandemic.
When you’re living alone, the threat of losing your job can be terrifying if you have no one to help support your living costs.
Even if you’re in stable employment, emergency living situations can crop up, which might include a broken boiler, leaking roof, or damp problems.
Such challenges can run into the hundreds or even the thousands if you need to pay for repairs.
Don’t have enough set aside? You’re in good company as almost 25% of Americans have zero savings set aside for an emergency situation.
If you live by yourself or are considering doing so, then it’s essential to set aside some of your monthly earnings for this very reason.
This will provide you with the comfort and reassurance that you’re able to financially support living yourself.
Approximately 10% of your earnings can be placed into savings for peace of mind.
Cheaper ways to live by yourself
Although our living alone tips are applicable wherever you live in the country, it goes without saying that your money will stretch further in some areas than others.
If you plan to live in popular, and therefore expensive cities such as NYC, San Francisco or Chicago, then you’d expect your accommodation to be smaller and more expensive than an affordable city such as Gilbert, Arizona, or Tulsa, Oklahoma.
Wondering how to afford living alone in a big city? If you have your heart set on this idea, then you may have to be more creative with your budgeting to allow your money to stretch far enough.
Here are some ideas.
Furnishing your apartment
If you’re buying a home to live in by yourself, then you’ll need to furnish it from scratch.
Some rental accommodation may be furnished for you, although be aware that the costs can be higher in these properties.
If you need to buy furniture, then this can eat into your budget before you’ve even moved in. So start the bargain hunting early to be sure you can snap up some great deals.
You’ll need a bed, sofa, and a dining table as a priority. Shelves, accessories, and soft furnishings typically make up a pleasant home too.
If the cost of these seems daunting, then consider second-hand purchases.
You can visit thrift stores, or check out listings on Craigslist or Facebook Marketplace to pick up some great deals.
Some sellers are even happy to give away their furniture for free rather than go through the inconvenience of paying for it to be disposed of or recycled.
If you’re searching for living alone tips, then the chances are that you can’t afford a cleaning service.
In this case, you’ll also need to budget for your own kitchen and bathroom cleaning supplies.
From your vacuum to varnishes and dust cloths to detergents, it can be expensive to keep a clean home.
Of course, living by yourself means that there will be a minimal mess and it is far easier to stay on top of your cleaning routine than if you share with other people.
To save money, try to stock up on unbranded cleaning products and you can try homemade solutions which often use simple ingredients such as lemon, soda, and vinegar.
Make energy-efficient changes
When you’re living alone, you’ll be in complete control of your energy usage.
If you leave the hall light on all night, then that’s on you!
But this also means there are plenty of simple adjustments you can make to keep your energy costs low. These include:
- Switching your lights for energy-efficient alternatives
- Turning off standby appliances
- Lowering your thermostat
- Washing your clothes at a lower temp (if you have a washing machine)
- Using a smart meter
- Putting an extra sweater on before turning the heating on in winter
- Changing utility suppliers to find a better deal
Creating your living alone budget
No guide on affordable living would be complete without discussing your budget.
The hard truth is that if you are on a low income then it may be more challenging for you to live by yourself and still be comfortable. But that doesn’t mean it’s impossible!
Follow the same budgeting rules as if you were a higher earner and choose your accommodation based on your monthly finances.
Ideally, you don’t want your rent or mortgage payment to be more than 25-30% of your net income.
That should then give you enough wiggle room to afford your other bills comfortably. Remember though that at the beginning of a lease contract, or a property purchase there are plenty of extra fees you’ll need to pay for.
For renters, you’ll usually pay your first and last month’s rent upfront as part of a damages deposit. There may also be admin fees to fork out for.
For homeowners, you can expect to owe money for anything from surveys, mortgage applications, and closing costs.
Work out how much money you’ll need to save up in advance so that there are no big surprises or disappointment.
You’ll also need to think about monthly outgoings.
Cooking your own meals can save money so you don’t waste on grabbing pricey takeout food or coffees.
Planning your meals on a weekly basis means you buy only the ingredients you need to use and find ways to use your leftovers too.
Have you decided how to afford living alone?
Are you ready to take the plunge and move in by yourself? Once you’ve figured out any financial barriers in living alone, you can enjoy the time and space you’ve gained by moving in with yourself. If you are lucky enough to have a second bedroom, then you can also reevaluate your situation a few months from now if you wish to sublet to a friend or roommate.
The key to living alone is to embrace the control you’ve acquired and make sure you take charge of the details to ensure your finances stay on track. To help you with all aspects of budgeting and savings, The Finances Hub offers a wealth of resources to provide you with current financial tips. Check out our informative blog today.