Dividing your salary and keeping an amount for travel and leisure is the ideal way to budget your salary, but when portions like rent take so much of your income, then it is time to reconsider your financial plans.
Rental Affordability, an Issue in Sydney
According to the International Business Times, Sydney is one of the least affordable cities for renting in Australia. Average workers spend at least 28 percent of their salary on rent while workers who receive lower monthly incomes use at least 65.
Even if its location is inconvenient for metropolitan workers, the suburban areas of New South Wales have affordable spaces for employees with below average salaries. Lsre.com.au, says many rental properties in Sydney are affected by its neighbouring areas as well when it comes to the rental fees.
Budget Your Rent Properly
Only 30% of your monthly salary should go to rent. A percentage higher than this is excessive for what you can afford on a regular basis. Though rent is on top of your basic needs, food, transportation, and personal investments should also take enough portion of your pay cheque.
There are three factors when determining the amount you should spend on rent.
You should first know how much you can afford when deciding on a rental space. The amount depends on your debts, bills, utilities, and net income that you receive every month.
Where do you want to live? Accessibility to work and commercial establishments should be greatly considered. Remember that commercial spaces have higher leases compared to rural ones.
If you plan on living alone, then rent a space that is large enough for you and your belongings. A bigger space sounds more fun, but its cost will definitely be bigger than what is expected.
It is wise to budget what you earn every month. Divide your income properly and remember that rent should not consume most of it. There are several living options that can fit your salary and lifestyle.