One of the most exciting parts of becoming an adult is moving out of your old place and starting your own life. However, as is the case with most major life events, moving out comes with a lot of added responsibility. Part of this duty is knowing and understanding your budget when shopping for the perfect apartment, condo, duplex, or rental house. So how much should you really spend on rent?

The 30 Percent Threshold

The first step in deciding how much you should spend on rent is calculating how much rent you can afford. This is done by finding your fixed income-to-rent ratio. Simply put, this is the percentage of your income that is budgeted towards rent.

As a general rule of thumb, allocating 30 percent of your net income towards rent is a good place to start. Government studies consider people who spend more than 30 percent on living expenses to be “cost-burdened,” and those who spend 50 percent or more to be “severely cost-burdened.”

When calculating your income-to-rent ratio, keep in mind that you should be using your total household income. If you live with a roommate or partner, be sure to factor in their income as well to ensure you’re finding a rent range that’s appropriate for your income level.

If you’re still unsure as to how much rent you can afford, consider an affordability calculator. Remember to consult a financial advisor before entering into a lease if you’re unsure if you’ll be able to make rent.

Consider the 50/30/20 Rule

Consider the 50:30:20 Rule

After you’ve set a fixed income-to-rent ratio, consider the 50/20/30 rule to round out your budget. This rule suggests that 50 percent of your income goes to essentials, 20 percent goes to savings, and the remaining 30 percent goes to non-essential, personal expenses. In this case, rent falls under “essentials.” Also included in this category are any expenses that are absolutely necessary, such as utilities, food, and transportation.

Let’s consider a hypothetical situation in which you make $4,000 per month. Under the 50/20/30 rule with a fixed income-to-rent ratio of 30 percent, you have $2,000 (50 percent) per month to spend on essential living expenses. $1,200 (30 percent) goes to rent, leaving you with $800 per month for other necessary expenses such as utilities and food.

Remember to Budget for Additional Expenses

Now that you’ve budgeted for rent and essential utilities, it’s time to make a plan for how you’re going to furnish your apartment. One of the biggest shocks of moving out on your own is how expensive filling a home can be. From kitchen utensils to lightbulbs and everything in between, it can be pricey to make your space perfect.

For the most part, furniture falls under the 30 percent of personal, non-essential expenses. Consider planning ahead before a move and saving for home goods so that you don’t go into major debt when it comes time to move out.

Be on the Lookout for Savings

If your budget is slightly out of reach for your dream apartment, try to nix unnecessary costs to see if you can make it work. Look for ways to cut down on utilities, insurance, groceries, and rent.

Utilities: Water, heat, and electricity are all necessities, but your TV service isn’t. Cut the cord on TV and mobile services that may not serve you and your budget anymore. Consider swapping out your light bulbs for eco-friendly and energy-efficient light bulbs to cut down your electric bill.

Insurance: Instead of paying monthly renters insurance rates, save a fraction of the cost by paying your yearly cost in full. If you have a roommate, ask to share a policy together at a premium rate.

Groceries: Swap your nights out for a homemade meal. You can save up to $832 a year with this simple habit change. When grocery shopping, add up costs as you shop to ensure your budget stays on track.

Rent: One of the best ways to save on rent is to split the bill. Consider getting roommates to save 50 percent or more on your monthly rent.

A lease is not something to be entered into lightly. Biting off more rent than you can chew can lead to unpaid rent, which can damage your credit score and make it harder to find an apartment or buy a home in the future. By implementing these best practices, you’ll hopefully find a balance between finding a place you love and still having room in your budget for a little bit of fun.

Sources: US Census Bureau

The post How Much Should You Spend on Rent? appeared first on MintLife Blog.

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How much money will you need to start a business? It’s the million-dollar question that every entrepreneur must answer.

Knowing how much money you need to start your business is critical, especially if you’re looking to raise money from investors or get a loan from a bank. 

If you overshoot and ask for too much, you not only risk rejection, but you also risk paying interest on money that you’re not spending. Ask for too little, and you risk running out of money before you’ve really given your new business a fair shot to get fully up and running.

There is unfortunately no single solution or even a specific dollar amount for individual industries. Every business is unique and costs are different depending on location — but fortunately, it’s not too difficult to calculate your startup costs

Here are the three steps you should follow to help you figure out how much money you need to start a business.

1. Create a business plan

Having an idea for a business is just the start of your business journey. To make it a reality, you need a detailed business plan.

Your business plan will help you define your business strategy which will inform your spending plan.

For example, if you’re starting a food truck, you’ll need to think about the kind of food truck you need. Do you need just a trailer that will stay parked in one location most of the time? Do you need a full-blown truck? What size? What kind of branding do you need? What equipment will you need?

Your business plan will help you think through everything you need to get your business started and help you think about the types of expenses that you’ll have as you get started.

If you need help with your business plan, check out our step-by-step guide.

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2. Create a detailed financial forecast

With a business plan in place, you can start crunching some numbers.

You’ll want to think about and plan for the following two categories of spending.

Startup expenses and asset purchases

Startup expenses include money that you’re going to spend on things like permits, business licenses, website design, improvements to your storefront, etc.

Assets are for tangible things that you need to purchase. For example, you may need to purchase inventory, computers, office equipment, vehicles, kitchen equipment, and other physical assets. A good way to differentiate an asset from an expense is to think about assets as something you could sell.

Ongoing expenses after you get up and running

Finally, you’ll need to plan for ongoing expenses and forecast those for at least the first 2 years of business. Ongoing expenses will include rent, payroll, taxes, insurance, utilities, and marketing costs. Of course, you may have other ongoing expenses as well.

With all of your spending planned, you’ll want to look at the total spending prior to getting your doors open, before you collect your first payment from a customer.

Then, you’ll want to look at what it costs your business to keep its doors open while sales ramp-up to cover those ongoing expenses.

Initial plus ongoing expenses provide a clear picture

Combine those two numbers and you’ll have a good estimate of how much money you’ll need to start your business.

A helpful tool in all of this is a cash flow forecast. You can use spreadsheets to generate your forecast, or you can use software like LivePlan to streamline the process. The idea here is to get a complete financial picture of your business and how much money is moving into and out of your business.

You can then add money to your financial forecast – loans, savings, and investment – to see how much is needed to keep you afloat while your business ramps up.

In the end, you’ll not only see how much money you need to start your business, but you’ll also see how long it will take to break even on your investment and start turning a profit.

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3. Plan for the worst

Just because your cash flow forecast says you need $50,000 in startup funding doesn’t mean that’s all you’ll ever need. You should still plan for the worst. 

To be on the safe side, it makes sense to secure 130% of the amount your forecast predicts—an extra third or so of your expected need, to provide a cushion.

After all, starting a business never goes exactly to plan. Things typically take longer than expected and cost more than planned. You’ll want to have a bit of a safety net to cover the unexpected.

Knowing the amount of startup cash you’ll need is crucial when you go to a bank or chat with prospective investors. If you’ve followed these steps, you’ve done your homework and should be able to answer any questions that come your way about potential funding.

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The average pet insurance policy premium in 2019 for dogs was $48.78 per month for dogs, and $29.16 per month for cats. 
Accident-only policies are cheaper than accident and illness policies, according to data from the North American Pet Health Insurance Association.
Your pet’s breed can also influence your price for coverage, with pricing varying widely by a dog’s breed. 
Get a pet insurance quote from PetPlan »

Most pet owners know just how expensive a trip to the vet can be, and how much a major health scare with your pet can cost. If you’re considering getting pet insurance, your monthly cost of pet insurance can vary widely. 

There are a few factors that can change how much your pet insurance will cost, including the type of pet you have. In general, insurance for dogs is more expensive than insurance for cats. And, for dog owners, the cost can vary widely by breed. See the rest of the story at Business Insider

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