Moving out of home is an exciting venture that many of us look forward to. The freedom is unmatched, your interior creativity can flow and you get a sense of adulthood independence knowing you’re responsible for yourself now. However, among all the exhilaration, there’s also a deep sense of accountability and a whole new set of responsibilities that come with moving to your own place.
Whether you’re renting or buying, we give you our 4 tips on how to financially prepare to move out of home.
- Estimate a budget
If you’ve been living at home rent-free until now, you may receive a rude shock when you realise how much you’re now financially responsible for. Sure, you’re factored in the weekly rental or mortgage payments, but have you considered utilities, internet and phone bills, strata, rental bond, revivalist fees, furniture costs, groceries, van hire and connection fees? The best way to create a plan of attack is to estimate a budget, ideally anticipating for more than expected, which will also ultimately determine whether you can afford this new move or not. Speak to trusted family members or friends who are currently living out of home to work out what exactly you need to consider and write down. Then compare it with your weekly take-home income and savings, to figure out how much disposable income you’ll have at the end of each pay cycle. Don’t forgot to add in the bills on your regular budget, such as car insurance, mobile phone plan payments, subscriptions and pre-existing debt repayments.
Bonus tip:
Investigate whether you’re eligible for any government entitlements, such as Centrelink payments that provide a living-away-from-home allowance and a youth allowance.
- Search the area for deals
If you’re moving to a new area, it’s likely you’ve already checked out how close you are to supermarkets, retail centres, petrol stations and doctor surgeries (if you haven’t, add this to the list!) In addition to those, have a look around the area for affordable shopping, such as a local farmers market to buy your groceries. Often you’ll be able to purchase bulk produce for a lower price than you’d pay at Woolworths or Coles, while supporting a local family farm in the process. If you’re one to shop at local thrift shops for deals, have a look how close your local Vinnies is or if there’s a buy, swap and sell market dedicated to clothing. Every little modality of saving helps when you’ve fled the nest, plus it can turn shopping into a fun little hobby!
- Make some sacrifices
As you take on this new responsibility, you may need to give up some of your past luxuries. As they say, “you can’t have your cake and eat it too”, which means weekly Friday night drinks may be off the table and you may need to wave goodbye to some subscriptions you’ve been holding on to. If you fear you may be paying loyalty tax spend some time searching the market and then switch providers for a more competitive rate if applicable. This can apply to credit cards, insurances, phone rates and more, freeing up some extra cash for your new essential bills. If you’re paying to subscribe to Binge, Netflix, Stan and Disney Plus, it’s time to streamline your streaming services and make a few culls. According to YPulse, 70% of Gen Z and Millennials are using streaming services with the majority paying for more than one service. They’ve found that 59% are paying for two to five, 12% for more than five and 64% of millennials on the older end of the spectrum (25-37 year-olds) are paying for two to four services.
- Furnish second-hand
The temptation to fill your new home with luxury goods and overprized throws is strong, however if this is your first move it’s more about learning to live on your own, rather than transforming your living area into an IKEA display home. You would be surprised at the amount of furniture people are willing to give away, whether that be family and friends, neighbours in a council clean-up or on Facebook marketplace. Unwanted furniture can be bulky and annoying to move, so often you’ll find people wanting to rid themselves of their pre-loved washing machine or lounge for free, provided you do the heavy lifting. It’s worth asking around and looking online at local ads, such as on Gumtree or on Facebook, to see if you can secure an item for your home at a very low cost, or free!
