I’m trying to figure out if moving out right now actually makes sense financially. I’m 22 making about $2,630/month after tax. Currently living at home, I pay $500 rent and about $280/month for my share of groceries, plus my own expenses (transport, phone, gym, haircut, etc.). In total I spend around $1,200/month and save roughly $1,400/month.
If I move out, I’d be looking at about $990 rent for a 1-bedroom, and with all expenses included (food, internet, etc.) my total would go up to around $2,000/month, leaving me with maybe $500–$600 saved.
So basically moving out would cost me about $800–$900/month in lost savings. My goal is to eventually buy property, but I also want independence and my own space.
For people who’ve been in a similar situation, was it worth moving out or do you wish you stayed home longer and stacked more money first?
I have little over 30k saved but cannot afford owning property monthly with current income
Should I move out of my parents home ?
byu/Positive_Log3018 inpersonalfinance
Posted by Positive_Log3018
7 Comments
Save up for a down payment on a starter home, you’re throwing away money if you leave to just go rent. It won’t take long if you’re saving that much a month.
What are you doing future-wise? To move toward higher earnings? I would stay home and focus on that – that’s pretty low income.
>but I also want independence and my own space.
Depends on how much you value these. Some people value their mental health over the lost savings.
But from a financial perspective, no you shouldn’t move out. Save as much money as you can.
If you’re not being charged full rent, it rarely makes sense financially. This is more of a personal decision. If you want to eventually afford property, especially in today’s higher interest rate environment, you have to hunker down and save as much as you can. There’s just no other way around this. If not, you will most likely be extending your renting timeframe until you’re in your late 20’s (assuming no black swan events or market shocks).
The other thing to consider is do you really need a property to live in, or does it make more sense to buy something to rent out, essentially giving you a cash flowing asset (which is what I did when I was a bit older than you, I’m 33 now). Just posing this question since you’re still really young. It’s something to think about. All in all, it’s a matter of what you value more.
If I were in your shoes I’d stay put for a bit and and see how this war plays out. If oil prices start high there will be a recession and mass layoffs.
In general, the financially optimal decision is to stay home and keep saving money. However, if you need more independence from family that’s a quality of life concern and paying rent may be worth it to you.
Honestly if your home life/family relationships are healthy. I would stay. Paying rent should grant you more independence even living at home, I would imagine.
Being able to save and stack money this early in your life is something you’ll never be able to get back. When I began saving in my 30s, my only real regret was how I so so so wished I’d set aside even just some small amounts of money toward retirement when I was exactly your age right now. Save as much as you can right now and you’ll be able to relax a bit more later.
Wanting independence makes complete sense, so for your own sanity, I’d completely map out your plan/goals. “Take course, complete by XX date, job hunt to make $x per hour, move out by x date” etc. just so you have that to work towards and look forward to and don’t feel like you’re just living at home forever.
And of course, if home is a bad or toxic environment, my advice is different.