This is a guest blog post written by our friend Angela, the founder and owner of P-A Financial Services (PAFS). She works to increase financial literacy among children, teens, and young adults. While working in the financial services industry, Angela discovered that many teens and young adults were just like her when she was in high school and college; a young person without the skills and knowledge to manage her money. Today, she is sharing her knowledge with children, teens, and young adults who are getting ready to enter their adults lives. We encourage you to learn more about P-A Financial Services (PAFS) and to check out the original post.
Many teens and college students are looking at moving out on their own this summer after they graduate from high school or college. Right now, though, most of them are focused on classes, grades, and their activities. Our (my husband and I) eldest son will be graduating from college in June of next year and is planning to move out on his own. We are excited for him.
As he is completing his courses and the time gets closer, he is planning out his future costs for rent, utilities, insurance, as well as his present costs for things like furniture and household items. A few days ago he wanted to go visit the new “At Home” store in our town to determine how much he would need to spend for the “essentials.” As we walked through the store, he began to get a bit overwhelmed. There is so much more that he needs than he realized.
We walked through the various areas. He quickly realized he will be a typical college grad with an eclectic array of a few furniture items. I think it was then that he realized that we (his parents) accumulated much of our personal assets over time.
Do you have a high school or college grad who will be moving out after graduation in 2017? Or, maybe you are the one graduating? Here are some of the items our son determined he would need and he is saving money to purchase. They are categorized by area of the home:
Kitchen: He already has a dinnerware set, flatware, and knife set. He will need glasses, pots, pans, dish towels and dish clothes. He likes to cook and doesn’t want to eat out all of the time to help with his expenses. He also knows it is healthier. Due to this, he has determined he will need mixing bowls, a mixer, measuring cups, measuring spoons, spatulas, and baking pans. He will also need storage containers for leftovers. A trash can, of course, for trash and possibly a dish rack for washing dishes. Many apartments don’t come with dishwashers.
Dining room/eating area: He has a table that he currently uses as a second desk, which he plans to use as a kitchen table. He will need chairs for the table.
Bathroom: Shower curtain with rings, bath mat, bath towels, wash clothes, and soap dispenser. He will also need a toilet cleaning brush and a plunger.
Living room: We have an old couch and TV we are giving him. So, he may need a lamp, which depends if the living room in his apartment has a ceiling light or not; many don’t. A chair would be nice. He needs a stand for the TV. He also needs a bookshelf as he is an avid reader. He has a desk for his computer and he has a chair.
Bedroom: He already has a bed, linens, and a dresser. He may need curtains, but this will depend on the apartment and if it has blinds or not. He may need curtains for the living room, too. He will also need hangers, a hamper, a laundry basket, an iron, and an ironing board. He doesn’t have a night stand and he may need a lamp depending if the bedroom has a ceiling light or not. Most do, but some don’t.
Laundry: This is an unknown and is often overlooked by new renters. If our son moves into an apartment complex, it may have a laundry facility; however, it may not. Some apartments have a hookups for renters to use their own washer and dryer. An apartment in a complex with amenities such as laundry facilities, fitness room, and a pool may cost $50 or a $100 more per month in rent. Since our son pays for a monthly fitness membership, which he actually uses, an apartment complex with these amenities might be a good fit. On the other hand, if he finds an apartment that is less expensive, but has washer and dryer hookups, he may want to consider that route especially if he can get a good deal on a set.
This is not a complete by any means, but it is a good start and is an example of how much goes into moving out for the first time. There are many decisions that new renters have to considered when moving out on their own for the first time. They usually focus on the rent and utility costs, which is very important, but they forget to think about how living in a particular place will affect their overall budget. For example, they may choose a location that is a twenty-minute drive from their work because it is $25 to $50 less per month in rent; however, what will the additional expenses in gas be? Perhaps, an apartment with washer/dryer hookups is chosen, but then a credit card is used to buy a washer/dryer set? Would it be better to pay a bit more each month in rent to avoid credit card charges for appliances? A person could then save money each month for a washer/dryer purchase and then buy them with cash.
The biggest shock to my son, and even to myself when I moved out on my own for the first time many years ago, was all of the things that are actually needed to run a home. It is a lot of stuff, especially if you are trying to save money by making your own food instead of eating out, for instance. Interestingly, decorations were not listed even though my son does want to do that as well, but he realizes that will come in time.
The bottom line: those who will be moving out on their own in the summer of 2017 should start planning early for the next big step in life to maintain control over their finances.