Budgeting Basics: Can You Afford This Apartment?

When you are in college, choosing where you live is an important consideration every single year.

Experts in budgeting say it’s always important to separate reality from desire. When it comes to picking an apartment, that can be hard to do.

Reality is basically your situation: you need a place to live. What does that entail? You need a place where you can sleep, cook, eat, and ideally study. You want it to be convenient to your job or school.

The “desire” part of you might also think you need the common courtyard area, the swimming pool, and the cool security guy at the front gate. You envision weekend parties and the time of your life.

The deciding factor often becomes money. Where can you afford to live?

Budgeting is the process of knowing how much money you have coming in, how much is going out, and where it is going. When you’re deciding where to live, you are making a decision about a large item in your budget: your housing.

That’s why it makes a difference whether your share of the rent is $200 or $400, $500 or more. If you only have a total monthly budget of $800, for example, that $500 rent is going to leave you extremely tapped, with only $300 to cover food, entertainment, phone and internet. At $200, you’re giving yourself twice as much money to live on. It’s an important decision.

When you are making your budget, do what you can to not use up every dollar you have coming in. The idea is surplus. Pick an apartment with a rent level that makes it affordable and not stressful for you. Your budget will thank you.