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Thread: Your Budget

  1. #1
    God/dess Bella21's Avatar
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    Default Your Budget

    I'm planning to move out of my parents house this summer and get my own apt. I've heard the rule of thumb is being able to pay your rent within two weeks. I can definately swing that... and still put away a couple hundred a month... Or so! It's so hard to tell with this business! How do you girls usually budget for your rent and utilities and whatnot and what percentage are you usually able to put away for savings?

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    God/dess Emily's Avatar
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    Default Re: Your Budget

    I think one week's earnings is better for rent/mortgage, but that's me since I save a lot.

    There's nothing wrong with living below your means!

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    Default Re: Your Budget

    I try to make my rent less than what I could make in a weekend...because sometimes I can make quite a lot in a month or even two weeks, but sometimes I get sick with my stomach problem or midterms or whatever. I never want to feel forced to go to work to pay my rent.

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    God/dess VenusGoddess's Avatar
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    Default Re: Your Budget

    I think that if it takes you 2 weeks to save up for your rent, you're going to run into trouble. You should make your rent in one week, otherwise, you are living above your means. Do not forget about utilities (gas, electric, phone, etc, etc) plus your usual bills (whatever they may be like credit cards). I always took 10% of each night and put it into savings.

    You should also have enough reserves to carry you at least 6 months, but even better if it's 12 months. Those reserves should be rent/mortgage plus each month's bills. That way, if anything happens, you are covered.

    Your total living costs should be BELOW 35-40% of your total earnings. The majority of Americans are living in the 70-75% range...don't do that. There should never be a choice of which bill to pay or if you pay rent or buy food. Having a place that takes up the majority of your income is foolish.

    Sit down, log all of your bills/expenses and then figure out how much you make (after taxes) a year and then decide how much you can REALLY afford to pay in rent/utilities.

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    God/dess Bella21's Avatar
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    Default Re: Your Budget

    The hard part is figuring out what I "make in a week" Sometimes it's 200-300, sometimes it's 1k. I have enough saved to cover about 6 months rent if something happens... I go to school full time so I usually only work two or three days a week. But, if it's summer I'll work 3-4 days a week or if it's midterms I'll work one day a week. Should I average everything out, then? Argh, my little brain.

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    God/dess Bella21's Avatar
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    Default Re: Your Budget

    Okay, So last summer (even with summer school, which I probably won't be doing this year) and during the nonstressful months of school, I was doing 3k a month. During midterms/finals months I was doing... 2k a month. I also get 3k from a trust fund every semester for school... But I've only got one more semester to go anyways.

    Rent's high in the san diego area but I'm moving closer to my school (and my job) which is more inland... I'm looking at about $900 a month for rent. My car will be paid off by then. Everything else like utilities, food, and gas will be under $800 a month. That's $1700 in costs right there.

    What do you guys think? Sorry to be such a pain. :-/

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    God/dess VenusGoddess's Avatar
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    Default Re: Your Budget

    Well, if you are averaging $2500 a month, your rent, etc. should be about $1000. That's not food, but rent, utilities, etc. However, if you are paying $1700 just in rent/utilities, that is really cutting it close for emergencies. In my experience, there is always something that happens which you need lots of money for. It's always better if you don't have to dip into your savings. You should be putting enough away for emergencies, retirement, and "rainy day" savings. If you are spending about $2000 a month just to live (rent, utilities, food, etc) you'll only have $500 to divy up into savings. Of course, some savings is better than none...but it's always better to live below your means and save up for later.

    Hope that makes sense.

    BTW...you should go to the library and check out the Suze Orman books. She's got great information there.

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    Banned Melonie's Avatar
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    Default Re: Your Budget

    I don't mean to harp on the point, but especially given the fact that you're from California, a state which is deeply in debt, which has also passed some recent 'employee dancer' laws, and which has been poking around at least one 'corporate club's operations, it's important to keep in mind that some 25-30% of your gross earnings are already owed to the IRS and Cal FTB in the form of income and self-employment taxes. Thus I agree that the 'benchmark' value of 40% of earnings as the maximum amount which should be spent on a rent/mortgage payment, but applied to 40% of your after-tax earnings.

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