Housing and living costs have sky-rocketed over the years. From 2017 to 2022, the average year-over-year increase in rent was 5.77% nationwide, with the biggest increase occurring from 2021 to 2022 at 14.07%.The average rent cost in America for a one-bedroom is easily over $800, with some states boasting rent prices at $1,500 or more. Two bedrooms are typically 30-50% more than a one-bedroom. Can having a roommate really help with housing expenses?
As the cost of living continues to rise, more and more people are finding that they can’t afford to live on their own. Sharing a home is an increasingly popular option, as it allows roommates to split the cost of rent, utilities, and other expenses.
Save on Rent
Rent payments take up a large chunk of an individual monthly household budget at roughly 30% of their household income. This can make it difficult to save money or afford other necessities. However, sharing the price of rent with a roommate can help to alleviate this financial burden.
Share Furnishing Costs
Furnishing a brand new apartment from scratch can be pricey. Not only do you have to buy the large furniture pieces (couches, tables, chairs), but you also have to restock all the household essentials such as pots, pans, cutlery, basic appliances, and more. You and your roommate can either share the cost of each item, or you can be responsible for every other item.
Split the Bills
Utility bills such as power, water, gas, WiFi, and cable are bills we anticipate on a monthly basis.One of the best things about having a roommate is the ability to split bills evenly. Living with someone else means that you’re never stuck footing the entire bill by yourself. Not only does this take away the financial stress of being a single person, but it also opens up your budget for other areas in your life.
Sharing Household Essentials
Splitting household essentials bought on a regular basis is another good way of saving money living with a roommate. Imagine how much you’d save if toilet paper, detergent, and trash bags were always 50% off. When you live with a roomie, that’s how it’ll feel shopping for essentials together. Splitting these costs in half will save both of you a considerable amount of money.
Merge Other Living Costs
In addition to saving on the usual, apartment-related bills, you can also be smarter about your living costs with roommates around. If you drive to work or school, you can carpool and split the gas fees. If you hire a cleaning service, you can split that fee, or if you’d rather clean the apartment yourself, you can split the cost of supplies (vacuum, broom, Swiffer, Clorox, etc.). You can also merge the cost of household essentials like toilet paper, olive oil, salt and pepper, and any other basic needs that everyone uses on a daily basis. You can even reduce the cost of groceries. No one needs two heads of lettuce, two gallons of milk, and two loaves of bread. Save money and pantry space by sharing staple food items.
Pay of Debt
Whether it’s student loan debt, credit card debt or an auto loan, getting out of debt can be hard when you have several monthly expenses. Getting a roommate can speed your debt elimination goals. Rather than all your cash going to bills, your disposable income can go towards paying off your consumer debt. This can free up money in the long haul and improve your credit score.
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Pitfalls of Having a Roommate
Could Cost You More Money
If you’re not careful, it is possible that a roommate could end up costing you even more money. This is especially true if you’re good friends or family members. If you’re super close to your roommate, again, set boundaries. Let them know you’re on a specific budget and would love to hang out but it has to be a free or low-cost activity. Don’t let them sweet talk you into ordering pizza 4 nights in a row. Having a roommate is supposed to save you money, so keep that in mind before choosing someone that can make you spend.
Roommates not getting along
it can be difficult to find a reliable and trustworthy roommate. It is important to take the time to find someone who you get along with and who will be reliable in terms of paying rent and other costs. If you don’t, it can lead to stress and financial difficulty.
Shared living is a powerful way to reduce your housing costs. As rents rise, this may result in more single adults sharing a house. Living with roommates is a great way to help save for your financial goals. To keep the atmosphere friendly, try to sit down and figure out your budget for living expenses early on. This way, you can enjoy the benefits of sharing expenses while avoiding the pitfalls.