Do you feel frustrated or at a loss about how to save money while renting on your own? It is a serious predicament for many, especially millennials. In the face of dire financial straits, a lot of millennials are having a hard time saving and paying their bills. To a degree, it’s really difficult to find money to save if you’re dealing with a saturated job market, loan debts, stagnant wages, and new generational values. But to sacrifice saving is to harm your present and future financial health. The truth is there are ways to eke out your funds and live well. Take cues from these eight money-saving tips.
1. Create a realistic budget
It’s important that you set a realistic division of your budget. For monthly budgeting, you can begin managing your funds with the 50/30/20 rule. Allot 50% of your funds for fixed expenses such as rent, insurance, loan payments, and so on. 30% is for saving with emergencies and the future in mind. 20% is apportioned to the fun stuff—socializing, vacations, shopping, gym membership. For some resort-style condo establishments, you can adjust the 20% and increase your 30% budget for savings because free use of amenities like outdoor park, swimming pool and fitness center are included in your rent.
2. Consume less and stick to necessities
Separate wants from needs. If it’s not a necessity, don’t buy it. Use the money for saving. A lot of millennials waste money on things they don’t need. Expenses you can consider cutting out are monthly magazine subscriptions, cable TV, and consumable habits such as smoking and alcohol. Frugal living while renting has more benefits than saving. It can instill discipline and appreciation for a less cluttered life. The next time you want to make a purchase, think hard and consider whether you actually need it.
3. Negotiate your rent
There’s no harm in negotiating your rent with the landlord. It can seem intimidating, but negotiating is a great way to save money. The worst that he or she can tell you is a “no”. But check carefully first before asking your landlord to lower the rent. See and compare the average rent for apartments or condos within the area. It’s also favorable if there are vacant units in the building as this means that there are options. Gather evidence to make a strong case to your landlord. You can also negotiate your deposit or application fee, and there can be a possibility of lower rent for a longer lease.
4. Slash your commuting cost
You can trade in driving your car and taking a cab with cheaper modes of transportation. If you live in a condo near your work, for instance, consider getting a bike or walking to work. You don’t have to think about car insurance, gas, and car repairs. Relying on a bicycle and your own two feet can save you a lot of money. They can be healthier and faster options, too. While taking public transportation is a good option, think if you can organize an office carpool. It can be more convenient and cheaper.
5. Cook and prepare food at home
Food is essential, but it can be a big money drain if you always eat out. You can have healthier and delicious meals by cooking at home. If your reason is you don’t have time, you can batch cook twice a week. You can recycle containers and use them to store your food during the work week. You can also freeze some of the food to make them last longer and if you don’t want to eat the same meal two days in a row.
6. Cut your utility bills
Paying bills can be a nightmare when your utility costs are high. Your electricity bill usually eats a huge chunk. Having an air-conditioning unit can be pretty expensive. But it can be physically impossible to endure hot summers without it. What you can do is set a schedule for AC use. For example, you can turn on the AC at night and use the fan during the day. You can also replace your bulbs with LED or CFL bulbs. They are slightly more expensive but they last longer and are energy efficient.
7. Get a roommate
How else can you save money while renting on your own? Consider getting a roommate. If you’re the type who has space issues, remember that you don’t necessarily have to share a room. You can also use a divider for more privacy if you live in a small apartment. Find the right person and be sure you divide rent-related costs together. You can split everything equally or you can opt to rent the place and sublet to your roomie. Having a roommate allows you the convenience of renting on your own, but at almost half the cost.
8. Treat monthly savings as a bill to pay
The last tip is as much a practical strategy as it is a mental trick: treat your monthly savings as an urgent bill to pay. This is not only for millennials but for a lot of people who consider saving as an afterthought or a discretion. There’s a tendency to focus too much on bills that you forget about the importance of saving. Each time you get your paycheck, automatically set aside a portion to save before paying your bills and other necessities. This guarantees a proactive approach to saving.
Renting on a budget can be tough. But following these eight tips ensures that saving feels less like an obligation. You’re financially limited at the moment, but if you are being smart about saving, it can be a vital step towards financial freedom.