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A Comprehensive Guide for Managing Your Finances as a Renter

By Gisele
July 27, 2020

Renting can help you save money and build a safety net for your future, especially if you start early and do it right. However, while it might seem effortless at first, you can slide down a slippery slope of spending if you’re not paying attention. 

For this reason, it’s important to learn how to create a budget and manage your finances. Then, eventually, it will become second nature and you’ll start saving automatically. To help, we put together a comprehensive guide on how to best manage your finances as a renter.

Rent Expenses

On this journey to becoming financially savvy, begin by thinking about balancing costs even before you move into a rental apartment. And, although these are generalities, always remember that it’s important to consider your personal situation and whether these ideas apply to your situation. 

Finding an Apartment

First, find an apartment that fits your budget. Ideally, you should allocate no more than 30% of your income toward rent. That’s because anything over that threshold can cause you to become rent-burdened. To get started, make a list of your necessities and begin prioritizing. Depending on where you decide to rent and your personal lifestyle, some aspects will be more important than others. For instance, renting in a big city like Houston, Texas, means that you’ll pay more for location. Therefore, you need to decide whether the cost of a commute (in both time and money) is lower than the location premium you would pay to rent closer to the city center. 

Space is another aspect you can compromise on. For instance, depending on your needs, a one-bedroom apartment could be enough, which means you’ll be able to save a lot of money by downsizing and renting smaller apartments. You can also prevent a small space from becoming overcrowded by applying certain design principles and also investing in multi-purpose furniture. Bonus: A smaller apartment will most likely help you save money on utilities, as well. 

Moving In & Other Costs

When you create a budget, be sure to consider move-in costs, too. These might include hiring a moving company and paying for cleaning services, but also — and perhaps more important — the fees associated with signing the lease and moving in. There are also a variety of upfront costs to cover, such as a security deposit, application fees, pet fees, and more. As a result, it’s a good idea to have a conversation with your potential landlord or property manager to discuss all of the other extra or recurring fees, as it’s best to be aware of these issues from the very beginning. Specifically:

  • Ask about utilities and whether they are included.
  • Inquire as to whether a longer-term lease means you can negotiate the rent.
  • Discuss what changes to the apartment would result in the loss of your security deposit.
  • Find out what penalties apply to breaking the lease early. 

Cost of Living

Besides the fixed monthly cost of rent, there are other expenses you need to budget for, as well, which might vary from month to month. When you pay for these services with a debit or credit card, make sure to select options that have no hidden or additional fees. For example, choose a banking option that clearly states all of the fees involved and doesn’t charge for maintenance or overdrafts. This will help you save a little every month and won’t add to the following costs:


Utilities typically include bills for electricity, gas, water, internet, cable, and sometimes garbage and sewage. Some properties include the cost of utilities in the monthly rent and, as such, receive a fixed amount every month. When deciding whether to opt for this option, ask around about how high the utilities costs are. Meanwhile, keep in mind that you can always implement habits for lowering your consumption, which results in lower costs for electricity, gas, or water. Multiple factors influence these costs, but the most influential is your usage, over which you have full control. 


Other payments that occur monthly are your subscriptions. Whether they’re for digital services like Netflix and HBO Go, or memberships to a gym, library, or club, make sure not to lose track of these expenses and review them regularly to decide whether you still need them. Scrutinize these costs to prevent them from sneaking up on you every month. 

Renters Insurance

Consider investing in renters insurance, which can help cover you in the event of an accident or unpredictable event. There are a variety of packages and deals you can choose between, so do your research and decide what applies to you. Then, choose what works best for your needs. Additionally, if you have a pet, there are also umbrella packages that may cover pet-related accidents. Otherwise, you could look into pet insurance, as well.

Frugal Living

To really be in command of your finances, be aware of your spending habits and create a budget designed specifically for you. While frugal living can help you reduce spending, keep in mind that extremes never work, so allow yourself the purchases you need to avoid turning that safety net into a spending net and shopping out of frustration. 

For instance, some habits that are easy to change are related to food and utilities, such as buying in bulk and cooking at home. These tactics save a lot of money that you would otherwise spend on eating out or fast food, and they’re also healthier — especially if you plan your meals in advance and try meal prepping for the week ahead. 

Another tip is to create micro-habits that help reduce your electricity, gas, and water consumption. These include turning off the faucet when you brush your teeth, taking shorter showers instead of long baths, and unplugging appliances when not in use. Or, even better, choose an apartment with energy-efficient appliances. All of these strategies can help you lower the cost of your utilities and your carbon footprint, which is an added bonus. 

In time, these things pile up and you’ll start seeing results after a few months. Be patient, though, as it takes a while to understand your spending habits. Also, try not to be too harsh on yourself. Becoming financially aware and savvy is a journey with many detours — not a straight line from point A to point B. Take your time and learn to embrace a more minimal lifestyle to save money in the long run.

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