![]() Your total utilities and service bills could add another 10% to your apartment budget, so if some of these are included, it makes sense to push your maximum rent up to around 40% of your after-tax salary.Ĭommuting and transportation is the other major concern. An internet package like shared Wi-Fi is also worth about $50 a month after all fees. Electricity is usually not included, but if so, realize that air conditioning in the summer is also another major expense. Heating bills can easily reach a hundred a month in a poorly insulated apartment during winter. The first thing you should check on rent is whether utilities and heating are included. In major cities, 30% might not be a realistic option. The hidden costs and benefits of your apartment’s rent You might want to go lower and higher for different reasons. Dividing this by 40, we are left with $1762 as our maximum monthly rent. We see that we would pay a total of $29,503 in federal and state taxes, leaving us with $70,497. I’ve circled the final number we want in red. As an example, if we enter $100,000 as our yearly salary living in Chicago, here’s what we see: There is a great calculator at SmartAsset that lets you enter your salary and location to find your after-tax take home pay. ![]() Your taxes change a lot based on your city and state of residence. That’s nice, but how do you figure out your after-tax salary? Another way to calculate your maximum monthly rent that gives exactly the same answer is to divide your annual after-tax salary by 40. The most basic advice you will hear is to allot 30% of your after-tax salary to rent. Here’s what to consider when calculating your apartment budget before you start hitting Craiglist and Zillow. Thinking of living in Los Angeles, San Francicso, or New York? Unfortunately, so is everyone else. Apartment budget calculator: how much rent can you afford with your income?Īre you wondering how much rent you can afford with your salary? Your rent is probably the biggest item on your monthly budget, and it’s no secret that rents continue to skyrocket.
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