Hi Money Minder,
I’m about to graduate in December and will be starting a full-time job in April 2025 with a salary of $70,000. Right now, I have around $5,000 in a High-Yield Savings Account and contribute about $15 a month to my Roth IRA. I also work part-time, making $11 an hour.
Luckily, I don’t have any debt to worry about as I always pay off my credit card in full. After graduation, I plan on moving back in with my parents, but I definitely don’t want to be there long term.
I’m curious about how I can afford to get my own place without roommates in a mid-cost-of-living state. Any advice on how to make this dream a reality would be greatly appreciated!
Thanks a bunch!
Seeking Independence
Response from THE MONEY MINDER:
Hello There,
Congratulations on your upcoming graduation! It’s great to hear that you will be starting a full-time job soon and have already taken steps to set yourself up financially. Moving back in with your parents temporarily is a smart decision to save money, but I understand your desire to have your own place without roommates in the future.
Given your expected income and current savings, here are some practical steps you can take to afford your own place:
1. Create a budget: Calculate your monthly expenses, including rent, utilities, groceries, transportation, savings, and any other costs. This will give you a clear picture of how much you can afford for rent.
2. Save for a down payment: While renting a place without roommates is your goal, consider saving up for a down payment on a home in the future. This may require additional budgeting and saving strategies.
3. Increase your income: As you settle into your full-time job and gain experience, consider opportunities for career advancement and salary increases. Additionally, you can explore side hustles or freelance work to supplement your income.
4. Research affordable housing options: Look into areas with a mid-cost of living where you can find reasonable rent prices. Consider factors like commute time, safety, and amenities when choosing a location.
5. Gradually increase your contributions to retirement accounts: While continuing to contribute to your Roth IRA is great, consider gradually increasing your monthly contributions as your income grows.
Remember that achieving financial independence and affording your own place without roommates will take time and careful planning. By setting realistic goals, budgeting effectively, and staying focused on your long-term objectives, you can work towards your desired lifestyle. Best of luck on your financial journey!
THE MONEY MINDER
