How Much Money Do You Need To Move Out?

Changing where you live is a long process, and it’s easy to get overwhelmed by all of the choices, tasks and costs that come with moving out.

To move out, you’ll need to earn enough money to cover rent, utilities, food and transportation every month. You’ll also need to cover one-time costs like moving and any required security deposits. A good rule of thumb is that your monthly income should be three times what you spend on rent. If it’s possible, have a few months’ worth of expenses saved up before moving out to provide extra security.

Take into account the different ways costs might add up and ask yourself: How much money do you need to move out? Let’s find out what you’ll need to save and how to make this transition as easy as possible.

9 Costs To Plan For When Moving Out

Here are some inevitable costs you’ll encounter once you’ve moved out. Provided below are median costs for things like rent or food to help you gauge a better understanding where your money will need to be spent.

Let’s get into what costs you can expect when you move out, and how to account for this when planning beforehand.

1. Rent

This will most likely be your biggest expense, and an important one too. Location is going to greatly impact the amount of rent you can afford, or how much you should save beforehand. An apartment in the city will have much higher rent than a house in a rural area. Depending on where you’re looking to move geographically, how much space you want and what your income is, you’ll need to make sure you’re able to afford rent every month.

Consider that the median monthly rent in the U.S. as of March 2023 is $1,937. This average has risen dramatically since 2020, with January of 2020 having a median rent of $1,585.

Also try to make sure that your rent isn’t taking up a large portion of your paycheck. While it may be doable, you won’t have as much wiggle room to accommodate for the cost of living, like utilities, groceries, or any unforeseen expenses.

2. Utilities

Alongside rent, you’ll also need to budget in how much utilities are going to cost. Common utilities you may need to consider are electric, natural gas, water, sewer, trash pickup, cable, internet, phone and recycling. Americans pay an average utility cost of $429.33 a month on utilities bills, but it’s important to note this number does include homes, which cost more to heat and cool. Some of these expenses are optional and may not apply to your situation. Many rental properties include some of these utilities and the cost is built into the rent.

Average utility costs will also vary depending on where you are geographically. If you live in a very rural area, you might have to pay more for internet or cable.

3. Food

The most essential cost, and one that you’ll have to pay for the rest of your life, is food. No one can go without eating, and whether it’s trips to the grocery or delivery, food will be a recurring expense.

According to the Bureau of Labor Statistics, food accounted for an average 12.4% of American’s spending for 2021. You’ll need to track how much you’re currently spending on food, and budget for that amount so you know exactly how much you’ll need to put aside from your earnings.

4. Transportation

After the COVID-19 pandemic, it seems like more people have the option of working from the comfort of their own homes. But there are many people who still need to commute to the office or in other circumstances, travel unrelated to work.

Depending on where you’ve settled, there are different transportation costs to consider. If you move to the city, you’ll need to find out how much a bus or subway pass costs or the amount you spend on car services or taxis. On the other hand, if you move to a rural area and have a car, how often you’ll need to fill up your car with gas, car maintenance or payments for vehicles.

The average American spends around $150 – $200 on gas each month, or over 16% of their spendings. This is an unavoidable and continuous expense for many people, so account for this in your budget to make sure you can realistically support your own needs.

5. Entertainment

Most people hear ‘budget’ and think that it has to be a strict regime, where no unnecessary spending is allowed. But it’s quite the opposite. In fact, budgeting is a great way to make sure you’re accounting for all aspects of your life, while also indulging in the fun stuff.

Set aside 10% of your monthly net income for entertainment, that way you have some money to spend on restaurants, bars or the movies without feeling like you’re cutting into your savings.

Additional Costs Of Moving Out

Now that we’ve covered the cost of living, here are some nonrecurring costs to be aware of.

6. Application And Security Fees

Most rental places will have an application fee, unfortunate but mandated by the state. Because of this, it will vary as to whether or not you have an application fee. Similarly, but more common, rentals will also require you to pay a security deposit which is a payment you make to the landlord or property owner before moving in. It acts as a sort of bond, if you get to the end of your lease and you’ve paid all your bills and you haven’t damaged the place beyond repair, you can get your money back.

Even if that’s the case, you still need to account for the money initially, as you won’t be getting it back until you decide to stop renewing your lease.

7. Moving Costs

A slightly more expensive spend, depending on your preferred method, moving costs can range from $800 – $2,500, with an average of around $1,400. This will depend entirely on how much stuff you have, what you’re moving and how far away. Get some quotes to see how much it would cost and go to a few companies, so you know you’re getting the best price and service.

You also might be able to handle moving yourself and avoid hiring a professional. Again, this will depend on many factors. Also consider this will be a one-time cost, so while it may be pricier to hire someone, it might also be worth it.

8. Furnishing

If this is your very first time living on your own, you’ll most likely need to invest in some furnishings. It could be simple things like a hook for the bathroom door, or not so simple things, like a couch. Depending on what you need, your spendings on furnishings can vary greatly, especially with bigger items costing upwards of $1,000. It might not be doable to get everything right away, so evaluate what you’ll need initially.

Start with the essentials, things you need to cook, clean and live your everyday life. Costlier expenses are harder to budget for; save up for these as much as possible before moving out.

9. Emergency Fund

Last but certainly not the least is the emergency fund. This is a great cushion to have, so that if any unexpected costs happen, you’re not digging straight into your paycheck and spending money but rather a fund you’ve made for this specific reason.

Remember that the amount you can put into an emergency fund will depend on your situation. It’s recommended that ideally you have 6 months’ worth of living expenses saved up. But, it takes time to build up that much in savings and it isn’t always realistic to be able to put money away, so start by setting a lower goal of 1 month’s expenses and slowly put in however much you can afford every paycheck.

Tips For Saving Up To Move Out

Here are some tips to help you save:

• Set a budget: Your budget will not only help you figure out how much you can afford to spend on certain things, but also help you set and begin long-term financial goals by getting you to think about savings.
• Consider remote work: Since transportation costs do cut into a large chunk of spending, consider remote work. Depending on your position, you might be able to work from home, or find a job that does allow this which would help you reduce how much you’re spending on travel.
• Find a roommate: A great option for those that want extra help paying for rent, utilities and depending on how close you are, entertainment and food.
• Don’t forget to make long-term goals: Even after you’ve made the initial move, you should still be saving. This is where your budget comes in that will help you make long-term goals, like saving for a down payment on a home. These goals will guide your decision-making when it comes to spending, and ultimately help you achieve them.

The Bottom Line

In order to move out, you’ll need to make sure your income can afford multiple things continuously. Rent, utilities, food, transportation and anything else that is recurring. Making sure this is achievable is so important because it will determine if you’ll be able to comfortably live in a place. Don’t forget the expenses it takes to actually move out, and any extra unforeseeable expenses that will pop up.

This can be an overwhelming task to take on, but through planning, budgeting and setting financial goals, figuring out how to save up your money can be easy.

If you feel like you’re not sure how to start dealing with your finances, download the app from Rocket Money^SM to help assess and meet your financial goals.