Budgeting for Extra Costs When Moving to a New Place

Whether you’re moving to a new apartment (like me) or calculating your current budget for job or life changes, we all end up asking the same question.

How much rent can I afford?

With all the excitement of moving into a new place and getting settled in, we might have a tendency to overlook some important factors. But you can use these simple steps, to help determine how much you can afford to pay.

Start by Calculating a New Budget

A good rule of thumb is to spend about 25 – 30% of your monthly take-home pay on housing costs (rent, mortgage, insurance and etc). My current rent is 19% of the net income from my full-time job, which of course, gives me a little wiggle room.

I’m not including my freelance writing or social media gigs, since I’m only starting to get those off the ground.

Any extra income I make will go towards traveling and investing my Roth IRA. I don’t want to make the same mistake I’ve made in the past and become house rich and cash poor.

Then Test it Out

Just to be sure I can actually afford a higher rent payment, I will be “paying myself” an extra $300 for the next 2 months.

I’ll be including it within the budget and taking the money out when the rent is due, just like a normal expense. This method has a dual purpose for me:

  • I can truly see if affording a higher payment is easy or difficult
  • The extra money I’m paying saving, can be used towards incidentals

Speaking of extra costs, there’s lots of other variables to consider when moving to a new place. Below is a list of added expenses to think before moving to a new apartment.

 1. Apartment Fees

Apartment fees vary widely, since some rentals are owned by companies and some are owned by individuals.

Most landlords will require a security deposit equal to one month’s rent and possibly even a move-in fee to hold the apartment. Many of them even tack on application fees, administration fees and pet fees.

2. Commuting Expense

If you plan to stay in the same general location, there won’t be much of a change in commuting or transportation costs. But if you start thinking of moving further out of the city, you might need to allot for a longer commute, which means higher gas and maintenance costs.

On the flip side, if you move closer to your job, you will be saving money each month which provides more cushion within the budget.

3. Replacement Costs

Whether you hire movers, or get friends to help, once you start moving your personal belongings, there’s no guarantee your stuff will arrive in one piece.

Plus theirs a much higher chance of damaging the apartment with so much going on, which means you might ruin any chances of getting the security deposit back.

So you might have to shell out extra cash to replace broken furniture and fix any damaged areas of the apartment.

4. Utility Changes

Unless you’re downsizing, you’re probably moving to a new bigger and better place, like I am. But along with the extra space comes higher utility bills.

Likewise, some rental companies include water/trash in the monthly rent while others do not. There’s additional expense for moving the electricity, TV/cable and internet to the new location which should be included in the budget as well.

5. Rental Insurance

For me rental insurance is a must, and only costs $72 a year to have all my stuff completely protected from fire, floods and theft.

Factors that determine the insurance rate include how secure (or not secure) the rental complex is, if the buildings are made out of brick or wood, in what year they were built and so on.

The monthly insurance premium might go up or down, once you move to a new place.

6. Double Rent Payments

Unless you have perfect timing, your rental payments from one apartment to another will overlap. It’s hard to find a new place, move all your stuff and cancel your old lease right when your new one begins.

The added cost could be pretty significant, so try wait for as long as you can, before making the move to the new place.


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Read more about WilliamPaid and my experience – here.


[Disclosure: if you sign up through my link, you will get $10 and I will get a commission, but it won't cost you anything. This is a special offer just for my readers.]
About the author: Carrie Smith is the financial artist and editor behind Careful Cents. She helps creative entrepreneurs make a living with their creations, and reach financial freedom through systems and financial organization. She’s been featured in The Huffington Post, Glamour Magazine, Kiplinger Finance and several other business websites. In May 2013 she quit her full-time accounting job to pursue entrepreneurship and blogging. You can find her on Twitter or Instagram @carefulcents.

Comments on this entry are closed.

  • Daisy May 9, 2012, 8:29 am

    I love the idea of testing it out – definitely something I’ll have to do when we move!

  • Jordann @ My Alternate Life May 9, 2012, 8:43 am

    Moving definitely contains a lot of hidden costs. I think when I finally decide to move into a more permanent place, I’ll use your method of testing the waters, it’s a good idea!

  • Modest Money May 9, 2012, 10:34 am

    I usually avoid the double rent payment by doing arranging to either move out a little late or move into the new place a little early.  I always wondered how other people handle that situation.  It does make the move rather stressful when it’s all on a time crunch.  You make a lot of good points of all the potential higher costs of moving to a new apartment.  Sometimes you also have to consider other things like how much more often you might go to restaurants or if you’d end up going to a more expensive grocery story.  When I lived downtown for a while I didn’t realize just how much extra I’d end up paying for that kind of stuff and things like parking.

    • Carrie Smith May 9, 2012, 11:39 am

      That’s a good point. I actually wrote that down in my notes, but forgot to mention it. My new place has covered parking (which I definitely want) but it will cost $40 extra per month. That’s an added expense I’m not currently paying for.

  • TacklingOurDebt May 9, 2012, 12:32 pm

    I’ve never had the opportunity to have an overlap between moving from one place to another either. It is quite tricky to do an entire move in one day and clean up the old place. A lot of work, but a bit easier if you have a moving company helping out.

  • Sean @ One Smart Dollar May 9, 2012, 2:08 pm

    Renter’s insurance is a must.  It is so cheap and you never know if something is going to happen.

  • Marissa May 10, 2012, 9:31 am

    I think testing it out is a great idea. Oh, and Renters Insurance is a must in my world.

  • Jason @ WorkSaveLive May 10, 2012, 10:25 am

    My wife and I are currently contemplating downsizing our home and buying a small duplex. The biggest thing we’re noticing is HOA fees for properties that have include lawn care and trash service.

    The commuting cost is also something we’re weighing heavily. We currently budget around $400/month in gas but now that we both work in the same KC suburb might be able to knock that down to $200/month if we’re able to move a lot closer!

  • From Shopping to Saving May 11, 2012, 3:53 pm

    When the BF and I were condo shopping, we took a lot of these things into consideration. How much can we afford monthly for the mortgage, including HOA/taxes/insurance/and any other fees like bonds or Mello Roos. Utility changes, repairs, fees for the broker and real estate agent, and everything were taken into consideration. We definitely tested it already since we were saving more than enough each month! I like how this applies to home buyers as well :)

    • Carrie Smith May 12, 2012, 9:37 pm

      Yes, it’s true. This is a good plan for anyone with a home, apartment or condo. There are lots of fees I didn’t realize.

  • MyMoneyDesign May 11, 2012, 8:19 pm

    You can’t under-estimate the renters insurance if you’re
    going to live in an apartment.  It’s
    dirt cheap and a load off your mind!

  • Barbara Friedberg May 12, 2012, 8:32 pm

    Your strategy is quite clever, of trying out the larger expense. We just increased our mortgage payment substantially by taking on a 15 year mortgage in lieu of the 30 year one. It was in the budget and I’m excited to know that our condo will be paid in full in 15 years or less!

    • Carrie Smith May 12, 2012, 10:59 pm

      That’s awesome! What an amazing thing that will be to pay off your home in half the time. Very smart decision. 

  • thisthatand themba May 13, 2012, 10:37 pm

    This is a great post because there are so many unseen things that we forget about when moving from apt to apt…the timing is the hardest one to get down perfect…it helps if you can try to negotiate with potential landlords…or even sublet if an option in your old place while you live in the new place…sometimes harder to do in big cities with apt complexes

    2 rents in 2 places is a hard thing to swallow paying for..

  • teacher April 27, 2013, 9:38 am

    3. Replacement Costs

    Second para: Plus (theirs) a much higher chance…correct to there is or there’s