Budgeting for Rental Properties Athens Ohio creates headaches for many people. Follow these key points to help your situation when looking for a place to live near Ohio University.
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Better Budgets Start with Savings, Not Expenses
What’s your target savings rate?
Set a “reach” target that you think is just barely attainable. The more important your dreams are to you, the higher you should set your target savings rate. At a bare minimum, aim for 10%. If you are all-in for a life less ordinary, try aiming for 20%, 30%, even 50%. At this moment, don’t worry about “how” but instead focus on your “why” – what it is that drives you to save and invest more money? Open a spreadsheet, or just draw a few columns on a piece of paper. Write down your target savings rate (we’ll use an example of 25%).
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Your Monthly Revenue: 4 Weeks’ Net Pay
In a given month, you can expect to receive paychecks for four weeks’ work, after taxes. That’s what your monthly budget needs to show in the “Income” column. If you’re paid biweekly, then occasionally you’ll get a bonus paycheck. Guess where that should go?
You got it – your savings for Rental Properties Athens Ohio.
In your spreadsheet, write in your after-tax, take-home pay for four weeks as your income. Immediately below it, subtract out your savings rate. We’ll use the median US income in our example: $57,617. Let’s drop that by 20% for income taxes, to $46,094. Weekly, that’s $886, so four weeks’ pay would be $3,546. Pull out another 25% for savings rate, and you’re left with around $2,660. That’s what we’ll work with for monthly income. We realize that as college students you may not be making this much or you are getting help along the way. You can factor all of this into your spreadsheet to find out how to get your Properties for Rent in Athens.
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Expenses for Rental Properties Athens Ohio
In your spreadsheet, mark out three columns:
- consistent monthly expenses
- variable monthly expenses
- irregular (but inevitable) expenses
The first column, consistent monthly expenses, includes bills like your rent on your Rental Properties Athens Ohio, that are the same every month. Write in every regular bill – Netflix, your cable bill, your phone bill, etc.
The second column is for expenses you incur every month, but which vary based on usage. Food is a classic example; others also include entertainment and utility bills.
The final column is for expenses that don’t come every month, but which will cost you money every year. Gifts, such as holiday gifts, birthday gifts, wedding gifts, etc. fall into this category. If you pay your insurance annually or semi-annually, that would also fall into this category. Medical expenses are another one. If you own a car, car maintenance and repairs fall in this column as well. Go back over the last few years and look up exactly what you spent on these sorts of expenses, then average them for monthly estimates of each.
At this point, just list everything out. Your budget is almost certainly in the red by now. Don’t sweat it. Before you can fix a problem, you have to identify and understand it! If setting a target savings rate was all about “why” this part of the budget is all about “what”. Remember, this list of expenses is just where you are now, not where you’ll end up. After this you should be well on your way to attaining the best Rental Properties Athens Ohio!
