How to Save Enough Money to Move Out

If you are stuck at home, living with your parents, here is a guide on how to make your dream of moving out a reality.

Cut your outgoings

You can save more money towards moving out by spending less money on:

  • Mobile phone: On a contract? Ask if you can switch to a SIM only deal in order to save money: or better yet, haggle for a lower price.
  • Travel costs: If you drive, see if you can make your car insurance cost cheaper. Switching to public transport or car sharing could save you money too. Travel by train or bus? Check if a railcard could decrease the cost and book in advance to save.
  • Entertainment: Nights out, Cinema tickets, Netflix, drinks at the pub, they all add up.

Keeping track of a budget to find out where your money is going and where you can eliminate costs is a great place to begin too.

Earn extra cash

If you work full-time, your salary is likely to be your primary source of income, so asking for a pay raise could really help your efforts.

There are many ways to earn a little extra too:

  • Sell your old and unwanted stuff online
  • Sell your old mobile phones
  • Make use of a penny jar or a coin bank to save up your loose change
  • Look for cashback credit cards to earn extra cash on your spending

Talk to your parents

Paying rent is good because it will help you prepare for your financial commitments once you move out. However, it will slow down your savings efforts.

Talk to you parents regarding how much rent you have to pay, and whether part of it could be placed towards your moving out fund.

Sharing how much you are saving per month with your parents can also be a great idea, as it can help them see that you are really working towards your goal.

Look for the best home for your savings

Receiving a decent return on your savings could help you move out faster, so it is worth looking for the best savings account you can avail:

  • Regular savings accounts can offer more attractive interest rates. However, you will only be able to save a set amount, typically between £100 and £500, every month,
  • High-interest current accounts usually beat the leading savings account rates. However, it limits the amount of money that you can earn interest on.
  • Peer to peer savings offers attractive returns by letting borrowers online loan your money. However, they have their high risks.

Work out how much cash you need

To move out, you need:

  • To earn enough money to pay for your ongoing costs, including council tax, utility bills, and rent
  • Enough money saved to pay for upfront costs including your agent fees and rental deposit

These amounts depend on your plans after leaving home. However, common ongoing costs include:

  • Broadband and Phone
  • Service Charges
  • Gas and Electricity
  • Water Bills
  • Council Tax
  • Rent or Mortgage

If you plan to rent

The upfront costs will be smaller. However, you will still need to save up for a rental deposit which is usually around two months’ rent.

There are also letting agent fees to pay for, including the costs of reference checks, and the costs of moving your belongings to your new home.

Some landlords also charge you for professional cleaning services or a holding fee to keep the property vacant until your contracts are finalised.

If you plan to buy

You will need to save enough money for a house deposit, which is normally at least 5% of the property value.

You also have to pay for solicitor fees, mortgage fees, and other costs when you buy – which implies that the upfront cost will be quite substantial.

What if the cost is too high?

If you are worried that the cost of paying everything yourself is too expensive, then there are ways to earn savings:

  • Look for smaller properties: Whether you plan to rent or buy, you will have to pay more money for larger properties. If you want to bring the cost down, you might need to look for studio flats or leaving the spare room.
  • Rent with other people: Sharing the cost of renting with a flatmate can make it a lot cheaper and more affordable. If you know people who are planning to move out soon, talk to them about teaming up, alternatively look at rooms in flat shares.

You have to pay for Council Tax whether you decide to rent or buy. However, you could receive a discount in some cases, for example, if you live alone, so check whether you could save some costs.

Before you move

As you approach your moving day, there are plenty of things to sort out before leaving home.

It is a good idea to make a checklist of all the companies and people that you need to inform regarding your new address, so you do not miss anyone off.