How to successfully move out of your parents’ house

September 04, 2024

Taking that first step towards independence by moving out of your parents’ house is exciting, but it can also be financially challenging. Whether you’re saving for a future home or simply craving more autonomy, this guide will help you navigate the path to independence while making smart financial choices.

If you’re living with family, you have a fantastic opportunity to build a strong financial foundation. As someone who recently made this transition, I can attest to the challenges and benefits of living at home. Let’s explore how to make the most of this situation and build your financial launchpad for a smooth future move-out.

Create an emergency fund 

Start by building a safety net. Aim to save enough to cover three to six months of anticipated expenses. You can also calculate your ideal emergency fund with this helpful tool from Nerdwallet. This fund will provide peace of mind as you transition to independent living. 

Consider setting up auto transfers from your paycheck to a separate savings account and look for accounts with rewards for saving. A savings cushion will protect you from unexpected costs and give you the confidence to make bold moves in your new independent life.

Develop a realistic budget

Use this time to create a detailed budget for your future independent life. Research the cost of rent, utilities, groceries, and other essentials in your target area. It’s helpful to compare your fixed costs to your income to budget for discretionary spending and savings. You can track your current spending habits with apps like YNAB or Rocket Money to identify areas where you can decrease spending. This exercise will give you a clear picture of what you can afford when you move out and help you avoid financial stress.

Maximize your savings

Try a “no spend” period where you only purchase absolute necessities. This exercise can boost your savings and help you distinguish between needs and wants. Challenge yourself to find free alternatives for entertainment and socializing. To stay motivated during this challenge, you can set a separate savings goal and use an interactive savings app like Tip Yourself. You might be surprised at how much you can save and how creative you can be. Use this experience to identify long-term spending habits you can change to increase your savings rate.

Set a clear move-out goal 

Establish a specific, achievable move-out goal and break it down into smaller, monthly targets. This will keep you motivated and focused on your transition. Create a timeline with goals and milestones, review your progress regularly, and adjust your plans as needed. These goals could include savings milestones, skill-building objectives, or tasks like researching neighborhoods. Regularly review and change your plans as needed. Celebrate small wins along the way to keep your motivation high.

Explore affordable housing options 

Consider alternative living arrangements to help you transition out while saving money. This is where coliving platforms shine – it’s an excellent option for those looking to move out while continuing to save. The largest coliving marketplace, PadSplit, offers affordable, flexible housing solutions that bridge the gap between living at home and getting your own place. With PadSplit, you can enjoy more independence while keeping your housing costs low, allowing you to continue saving for your long-term goals.

Increase your income 

Look for ways to boost your earnings, such as asking for a raise, taking on a side gig, or leveraging your skills for freelance work. Explore gig economy apps or freelance platforms like Upwork for additional income opportunities. Increasing your income helps you save more but also gives you valuable experience and potentially new skills. Remember, every extra dollar earned is a dollar closer to your goals.

Do it yourself

Acquire crucial money-saving skills, like basic home maintenance and cooking. Familiarize yourself with tasks like fixing a leaky faucet or meal prepping to save money. Watch online tutorials or take a local class to learn essential DIY skills.

Don’t forget about automotive care – changing your car’s oil and air filters can lead to substantial savings on vehicle maintenance. Additionally, hone your financial management skills by practicing budgeting, tracking expenses, and understanding the ins and outs of credit scores. 

Each of these practical abilities saves you money and builds your confidence in handling the challenges of living independently. Consider every skill you acquire now as an investment in your future independence and financial stability.

Build up your credit score

Good credit is key for your financial future, especially when you’re preparing to rent or buy a home. If you’re just starting out, consider getting a secured credit card with a lower credit limit. To build your score effectively, strive for a credit utilization below 30% of your limit, pay off your balance every month, and always pay your bills on time. 

For those still building their credit, PadSplit offers a great housing solution, as they don’t require a minimum credit score for membership. This allows you to gain independent living experience while continuing to improve your credit. Remember, an excellent credit score can lead to significant savings on deposits, insurance rates, and future loans, so start building your credit early and consistently.

Research and plan for hidden costs 

Prepare for additional expenses beyond rent, such as furniture, renters insurance, and moving costs. Make a checklist of necessary items and track sales or second-hand options to save money. Remember to factor in costs like renters insurance, parking fees, or pet deposits if applicable. Planning for these expenses now will prevent financial anxieties later.

Set boundaries and expectations

Have open conversations with your family about your plans. Set clear boundaries for your new independent life, and plan for future family time. Discuss how your relationship might change once you move out. Will you still have family dinners? How often will you visit? Setting these expectations now can help ease everyone’s transition. Remember, moving out doesn’t mean leaving your family behind; it’s about redefining your relationship as an independent adult.

Embracing newfound independence

Moving out of your parents’ house is a significant milestone, but it doesn’t have to be a financial setback. By following these tips and considering affordable options like PadSplit, you can enjoy your newfound independence while maintaining financial stability. Remember, this is just the beginning of your journey – with thoughtful planning and budgeting, you’re setting yourself up for long-term success.

As you embark on this new chapter, be patient with yourself. There will be challenges and learning experiences, but that’s all part of the growth process. Stay focused on your goals, but remember to enjoy the journey of becoming independent. 

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