Renting is a great option for people who cannot afford to buy a house or who wish to spend their income in other ways. Although it is a money-saving process in itself, you can actually minimize the spending and add to your savings account while renting. All you need to do is to make and follow a plan for reducing costs, starting with the very first stages of research and up to actually living in your rental apartment.
Here are 4 of the most important steps to take to save money while renting:
- Spending time on research
It is of utmost importance to take your time and be critical in your research process. Learn to balance your wants and needs and prioritize what is a necessity over what would be nice to have. One of the most important aspects of choosing an apartment is location. You should try to avoid renting close to city centers or near business areas, but you shouldn’t sacrifice a lot of time on commute either. Find a spot that is close to public transportation or offers you a direct route to your job or school. Calculate the distance and how long it would take you to travel from place to place and decide how much you are willing to sacrifice on that.
You can also consider renting with other people. If you find a nice apartment that has more than one bedroom, you can partner up with someone and split the rent. If none of your acquaintances want to join you, there are plenty of reliable apps you can use to find a roommate. It’s easier now than ever to find housemates.
- Choosing the apartment type
The sheer number of options you’ll find might be overwhelming, but you can easily sort through them. Apart from price range and location, seriously consider what type of apartment is best for you. If you don’t have furniture and you are thinking of buying some, maybe consider renting a furnished apartment for the time being. It could suit you if you plan on traveling to distant places or moving again for other reasons. It definitely varies from one situation to another, but there are pros and cons to both furnished and unfurnished apartments.
Be careful with apartments that have utilities included in the price, because that might backfire. You can control your energy consumption and intentionally reduce costs, which will turn out to be more profitable for you than being tied to a fixed amount.
- Signing the lease
When you’ve found your new home and the time comes to sign the lease, read the contract very carefully. Ask questions wherever things are unclear and make sure both you and the landlord understand your obligations. Before signing the lease, when you’re checking out the apartment, be attentive to flaws that you can bring up in the discussion and ask for a lower rent. Negotiating rent is a must.
A good idea is to rent long term, because the longer you rent the lower the monthly cost will be. Ideally, one year will reduce the rent while not tying you down and be too much of a commitment. Showcase yourself as a reliable person, even offer to fix things if necessary, and use this to convince the landlord to cut down on your bill.
- Living in the apartment
After you’ve moved in, remember to keep the same mindset. Adapt your lifestyle in order to save money. Be aware of how much energy and water you consume and reduce that. It’s as easy as turning off the water while brushing your teeth or unplugging the microwave before you leave the apartment. These are minor things you can do and turn them into habits which add up and cut a significant amount off your monthly bill.
If you rent in a busy city like Seattle, you might fall prey to eating out or ordering food on a daily basis. A hectic lifestyle of running from one place to another could make you feel like you have no time, but if you decide to cook for yourself at least once every two days, you’ll not only eat and feel better, but also save a lot of money in the process.
General Rule of Thumb: Follow the 50/30/20 Rule
The 50/30/20 rule is the golden ratio of budgeting. It stands for 50% of your budget spent on needs, 30% on wants, and 20% on savings. Try to adjust your spending habits and fit your monthly costs in half of your salary. Divide the other half of it and try to put aside 20%. The rest of 30% goes to your wants for the month, or towards covering unexpected expenses. It may seem hard to implement, but if you have this rule in mind from the very start, it will be easier to decide and to keep an eye on your budget and discretionary income.
About the author: Mihaela is a passionate reader and writer, with an affinity for language and linguistics, as well as the latest technological developments. She discovered her passion for real estate at RENTCafé, and you can read more of her articles on their blog.