It’s been a hot minute since I moved out of my parent’s home – almost 10 years! I didn’t have a huge amount of belongings, but I packed them all up into the boot of my Mitsubishi Mirage and transported them all of 10 minutes away to the apartment I would share with my boyfriend.
All these years later, my youngest sister is looking to make a similar leap from the nest and asked for my advice. I remember being a bit clueless when I first decided to strike out on my own, so I decided to put together a few of my lessons as a guide to moving out and taking the next big step in adulting.
WRITE A BUDGET
You probably aren’t too surprised that my first tip is to get a budget in place. Nothing will take the wind out of your sails quite like getting into your new place and realising you can’t afford rent AND food. If you’re a budget newbie, you can take a gander at my Beginner Guide to Budgeting here.
The biggest takeaway from this tip is to start your budget BEFORE you move out of home. Write out a detailed list of all you. r transactions using your current income and your expected expenses once you’ve moved into your own place. This should include things like:
- Contents Insurance
- Transportation / Personal Vehicle Costs
- Food (groceries and the odd takeout)
- Utilities & Insurances
- Bills (phone/internet/Netflix subscription)
You should also be stashing some savings into an Emergency Fund for unanticipated expenses like tolls/repairs, and allocating some savings to fun things like a holiday or lust item.
It’s a lot to look at, isn’t it? Being self-sufficient brings a lot of pressure from the outside world, just about all of which can be allayed with money. If your expected outgoings are higher than your income, get back to the drawing board and either increase your income or decrease your expenditures.
Once you’ve got your budget in the black (that is, living solidly within your means) attempt to live within this budget for a few months before you actually move out. Can you do it? Does it require any tweaking? How much do you need to cut back on entertainment and inessential expenses?
Keep adjusting your budget until it’s just right – giving you enough flexibility to cover your responsibilities and still have some left over the save/invest/splurge.
GET RID OF DEBT
Do you have any debt? Ideally, you would leave home without any debt. In fact, if you have debt it would be a much better choice to stay at home with your parents and allocate a large proportion of your income to paying down the debt so you can leave debt-free.
The increased financial pressure that comes when you move out never goes away. Inflation increases the cost of living and any “spare” money you have tends to get eaten up by small things like an extra takeaway coffee or a big spend just before Christmas.
That debt will continue socking you with interest charges, growing larger and larger the longer it takes you to pay it off. Getting rid of the debt means all the money you bring in is yours and isn’t going to pay off the meaningless interest. Trust me, if you can leave home without debt you will be in a much better financial position to start your adult life.
SAVE UP FOR THE MOVE
Moving out isn’t just about your expected ongoing costs. The actual process of moving involves lots of one-off charges, such as a rental bond, contents insurance, internet connections and deposits that need to be paid upfront.
Removalists, if required, charge a hefty hourly rate and even hiring your own moving truck will cost you a chunk of change. Real Estate agents generally require your bond and two weeks rent be paid upfront, meaning you need 6 weeks rent stashed away before you even start your ongoing budgeted costs.
You can rent any home you like, but it will likely come empty. This means you need to have some furniture to fill it. While many young adults dream of a swanky apartment filled with art-deco, vintage pieces, more often than not you’ll be scouring Gumtree and Marketplace for secondhand couches and doing the rounds at garage sales with your eye out for a bargain.
There is some real money to be saved by purchasing secondhand furniture, not to mention you’re reducing your environmental footprint and giving an item new life. As your career progresses, you’ll be able to upgrade to nicer furniture and appliances and sell your own things on to fresh-faced young things moving out for the first time. The circle of life!
A WORD ON CREDIT
Importantly – do not take on new debt once you’ve moved out. Credit cards have some benefits, but if you’re paying interest on your expenses you’re immediately losing the game. Stick to spending only what you can afford (in other words, flash that debit card and nothing else) until you are certain your finances are under control and you can pay any credit card balance off in full at the end of each month without long-term detriment.
The interest-free loans advertised at many big-name furniture stores are an option I have used before, however, you need to read the fine print and understand exactly what you are signing up for. Again, these should only be used when you’re in a stable financial position and are sure you can afford to pay back the full amount within the interest-free period. Watch out for annual fees and extra charges, and ensure your repayments are not defaulted to the minimum required amount.
OTHER THINGS TO THINK ABOUT
Sharing a residence with others (be it platonically or with a romantic partner) adds another layer of complexity and not just because you’ll generally find yourself passive-aggressively fighting others for space in the fridge. You have to decide:
- How you will split bill payments
- What happens if someone wants to move out
- How you’re going to divide chores and pay for food.
- What happens if someone gets behind on rent.
You should always have a written agreement when living with housemates, whether or not you have directly signed the lease. If you are not on the lease, however, you take the risk of having no rights about your place of residence if something should happen, or the head-tenant (the person who has signed the lease) decides to move out or cause issues.
If you’re planning to move in with someone, understand the facts and be prepared to stand up for your rights as a rent-paying tenant. Where possible, sign a lease directly with the real estate agent for maximum protection against another tenant’s bad behaviour.
The RTA website is super helpful when it comes to answering questions about your tenancy and can assist in deliberations or tricky situations if they are to arise.
Always read your contract, particularly the boring fine print. The fine print is where the actual contract lives, not the fancy, attractive glossy minor details on the first few pages.
Ensure you know about any cooling-off periods and cancellation fees. Ask for clarification or more information if there’s something that isn’t entirely clear to you.
Between lease agreements, utility providers and gym memberships you could potentially have a lot of paperwork awaiting your signature. Taking the time to read through everything you sign saves you from nasty surprises down the track.
UPDATE YOUR DETAILS
Once you’ve got your ducks in a row and have taken the leap and moved out, make sure you remember to contact all your suppliers and update your address details.
Most bills are emailed these days, however, there’s nothing worse than a bill going to your parents’ house, sitting there for weeks until you remember to pick it up, and getting stung with an overdue fee. I now keep a list of companies/organizations that require my address updated whenever we move (which happens more often than I’d like) and it helps jog my memory.
Some big ones are:
- Any bills you had before you moved out
- Your driver’s license and other identification
- Government organisations – Centrelink, Medicare, ATO
- Health – doctors surgeries, dentists, optometrists etc.
So tell me: what is some advice you wish you could pass on to your younger self before moving out? Your tips could help someone set themselves up for success!