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Are you dreaming of moving out and gaining more independence? Moving out on your own can be an exciting and liberating experience — but it comes with a fair share of financial responsibility.
The most important part of moving out successfully is having enough money to cover the costs. Whether you’re planning to relocate for work, start college, or embark on a new chapter, building up savings will make your move smooth and stress-free.
Here are seven practical steps to help you save money efficiently and achieve your goal of moving out.
1. Assess your situation
Before you start actually saving, set a clear financial goal — “moving out” isn’t specific enough. Figure out how much money you need for moving expenses, such as rent, security deposit, utilities, and furniture.
Assess your income and calculate how much you can save each month. Having a specific number will keep you focused on your goal.
Consider some factors outside of rent, Jasmine Paul, founder of the Wealth Playground, says.
“How will they furnish their place of residence?” she says. “[This includes] pots, dishes, a bed, a mattress, and if they own a vehicle, saving for oil changes, routine maintenance and car insurance,” she says.
You’ll also want to consider how much you’ll spend once you move out. This includes everyday expenses like groceries, gas, and other bills. If you use a debit or credit card, you can often look at your bank account to look at your spending habits.
Use a savings goal calculator to help you determine a specific savings number for these future expenses.
2. Set a realistic moving timeline
While your initial number to move out may feel daunting, making a plan and setting a timeline can motivate you.
Now that you know how much you can feasibly save each month by looking at your income and expenses, you can forecast how long it will take to get there.
Or, if you already have a date and target goal in mind, you can calculate how much you need to save each month to get there. If your current income and spending are preventing you from reaching your goal in time, you may need to start making some adjustments. This could mean increasing your income and cutting back on some expenses.
3. Create a budget
Creating a budget is crucial to track your expenses and ensure you’re saving enough money to reach your goal.
List all your income sources and fixed expenses, such as bills and subscriptions. Dedicate part of your income to your savings and put the rest towards flexible expenses like groceries or entertainment.
By following a budget, you’ll get a clear overview of your finances and be able to identify areas to cut back. Money-saving apps can help you monitor expenses and track your progress.
Consider downgrading your phone plan, switching to a cheaper internet provider, or negotiating lower rates on your bills. Not everyone can carpool to work or cut out subscriptions, but if you’re willing to make some larger concessions, you can move out faster with a better savings cushion.
4. Prioritize your savings
To ensure consistent savings, automate the process. Set up an automatic transfer from your checking account to a dedicated savings account each time you receive your paycheck.
By removing the temptation to spend, you can build up your savings without thinking about it. Remember, slow and steady progress is better than no progress at all.
Consider opening a separate high-yield savings account for your moving fund. These accounts have higher interest rates and can help your savings grow faster.
5. Increase your income
Increasing your income isn’t always simple, but it’s one way to accelerate your savings and help you move out faster.
Look for part-time jobs, take on freelance work, or explore the gig economy. If you have a full-time job, you can look for opportunities to get promoted or take on more hours. You could also sell unwanted items online, tutor subjects you excel in, or offer your skills as a dog walker or babysitter.
6. Save on housing costs
One of the biggest challenges of moving out and living alone is the increased costs. This is especially true if you’ve been living with family for free.
Consider slowly transitioning to living alone in a way that helps you keep saving in the interim. Consider downsizing or finding a roommate to split rent and utilities. Look for affordable neighborhoods or consider living in a nearby suburb.
Additionally, explore alternative housing options like house-sitting or renting a room in someone’s home. You can save a significant amount of money by reducing your housing expenses.
Paul says that saving on certain expenses like furniture can lower the cost barrier to moving out. You can look online at marketplaces for used furniture to furnish your first place.
7. Build an emergency fund
While saving for moving expenses is essential, building an emergency fund is crucial. Unexpected costs, like medical emergencies or car repairs, can derail your financial plans.
It’s smart to save at least three to six months’ worth of living expenses in an easily accessible account. This will provide a safety net and peace of mind, Paul says. If you have the ability to build this emergency fund before you move out, it can help you sustain your move toward independence.
The bottom line
Saving up to move out on your own involves looking at your current finances and identifying places to save and cut back.
That money should allow you to pay big expenses like your security deposit, but could also offer extra savings to help you in the first months of living on your own. Preparing for the future now, while you have lower housing expenses, can be a great start to a life of financial independence.
Opinions expressed are author’s alone, not those of any bank, credit card issuer, or other entity. This content has not been reviewed, approved, or otherwise endorsed by any of the entities included in the post.
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