City Living on a Budget

As urban centers continue to see rents skyrocket, it is important for many to learn how to live in a city on a budget. Here are some tips to get you started:

1. Build a real budget and stick to it.

Learvest is a financial planning tool created by a Harvard Business alum. Their team recommends at 50/20/30 rule.

50% of income should go towards fixed costs (this will largely include rent)

20% should go towards paying off debt or be put into savings

30% should be used for flexible costs (entertainment, eating out, etc)

2. Think about what your rent includes and take advantage of these offerings.

Think about what rent includes. Are utilities included? Do you have a gym? Is parking included? Is public transportation readily accessible nearby? Do you have access to free laundry?

These are all money savers that can lower your effective rent.

3. Reduce transportation costs

A car can easily zap your budget. Financing/leasing costs, gasoline costs, maintenance, and insurance add up very quickly. Instead, opt for public transportation and perhaps look into a bus pass. A bicycle can pay itself off in no time and prove to be a worthwhile investment.

4. Eat-in more frequently.

While it can be tempting to try the array of restaurants that come with living in a larger city, make a concerted effort to cook your own food. This can save hundreds of dollars per month. Try to make cooking a fun event and include friends when possible. Likewise, packing a lunch during the day can also have the potential to save hundreds of dollars per month.

 

 


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