Moving Out? 5 Money-Saving Tips You Need to Know

Moving Out? 5 Money-Saving Skills You Need to Know

I moved out of my parents’ house and into my first apartment when I was 19. Leaving the comfort of my childhood home was daunting, but I was excited to start my journey toward financial independence. Though the apartment was grubby and cramped with a heavy-footed neighbor living upstairs, it was my own and I loved it just for that.

At the time, I was halfway finished with my bachelor’s degree, and I thought I knew it all. But here’s what I didn’t know: how to manage my money. Here are five things that — I soon found out — would have helped me save money and avoid costly mistakes during my first venture into independent living.

1. How to budget 
   After I moved out, I couldn’t believe how fast money disappeared. Earnings from my two part-time jobs used to be plenty for gas, daily meals out and some weekend shopping. Now, I had to stretch my money to cover rent, utilities, internet, phone, insurance and groceries — on top of everything else.
   
   I needed to create a budget before things got out of control. After researching budgeting types, I chose the envelope budgeting method and began writing down my income and expenses for one month, then setting up categories that would help me manage my spending.
2. How to save 
   My initial budget worked for a while, but it only took one flat tire for me to realize it was missing a key category: saving. I hadn’t been putting money aside, so I didn’t have an emergency fund or anything saved to help me pay for the tow truck, repair and new tire. I drained my bank account trying to get my car back on the road. After that life lesson, I switched to the pay yourself first budget method and committed to stashing 10-20% of my take-home pay into a savings account and regularly putting a little money into an emergency fund.
3. How to change a tire
   Changing a tire used to be easy — just call Dad. But as soon as I was self-reliant, I needed to get familiar with tire irons, wheel covers and jacks. Knowing how to do a simple 15- to 20-minute repair would ultimately save me hundreds of dollars. If you don’t know how to change a tire or make other routine repairs, ask a trusted friend or family member to show you. Worn tires are more likely to cause a blowout or other safety hazard, so check your tires (including the spare) to ensure they are in good condition and properly inflated.
4. How to build credit
   My parents encouraged me to sign up for a credit card with a low limit, but I was too scared to use it. Wasn’t credit the path to overwhelming debt? Weren’t cash and debit cards a lot safer?
   
   Using cash ensured I would only spend the money I had on hand, but it wasn’t helping me build a credit history. Without a credit history or a credit score, I learned that it was difficult to get approved for auto financing or a nicer apartment.
   
   I started using my credit card for small purchases that fit in my budget — gas, lunch, occasional treats — and always paid the balance in full each month. Using credit responsibly helped me establish good spending habits and a healthy credit history.
   
   If you're already using credit, moving out is a great time to learn how to build a better credit score.
5. How to ask for help 
   I used to barrel through life without asking for help. I didn’t want anyone to think that I couldn’t handle the freedom of living on my own. So when my sink clogged, or I tried to craft my first résumé, or I needed a new car but didn’t understand the dealership experience, I convinced myself that I was on my own.
   
   It was a great lesson in independence, but I also had to work a lot harder and fail a lot more. I wish I had realized sooner that I was surrounded by friends, family and mentors who were glad to share their experience and wisdom. It would have helped me make smarter decisions, form stronger relationships and get on the road faster to a bright financial future.

If you’re moving out for the first time, congratulations! It's an exciting step on the road to independence and adulthood. Looking for more ways you (or maybe someone you know) can make smarter decisions and work toward financial freedom? Check out free financial education courses on KEYS^® Online.

By Brooke Howell, GM Financial

Brooke Howell is a storyteller who loves digging up ways to improve money management and help others make smart financial decisions. She has three American Staffordshire terriers, one curmudgeonly Chihuahua and doesn’t do anything by halves (except marathons).