Before you move out

Moving out from your family home might seem like a great idea, but as a first-time renter there are a few things you should know so the experience doesn't become a nightmare.

Costs of moving out

Video: Goodbye family, hello bills

Goodbye family, hello bills video

Don't let the excitement of moving out distract you from the costs involved. Watch this video to be sure that you can afford to do it, then go for it!

Transcript: Goodbye family, hello bills

Before you move out, use the MoneySmart budget planner to create a budget. The budget will help you add up all the costs of moving out of home and your new living expenses.You need to be honest with yourself when you do a budget so you can plan for any unexpected and ongoing expenses.

Budget planner

The TrackMySpend app can help you track your spending before and after you move.


Ongoing costs

Renting a house or flat can be expensive. Make sure you have enough money to support yourself because you'll have lots of ongoing costs once you leave home: rent, bond, renter's insurance, utility bills like gas, water and electricity, food, entertainment and transport, just to name a few.

And don't forget if you have a credit card or a personal loan too, you'll need to keep up those regular payments on top of your other bills.

One-off costs

Before you leave home, think about the one-off costs of moving: removalist fees or costs of hiring a moving truck, rental bond, connection fees for phone, internet, gas and electricity, parking permits, furniture and furnishings, linen and kitchenware, just to name a few.

In most cases if you're renting, you'll be asked to pay 2 weeks rent in advance and a bond (usually 4 weeks rent) as a security deposit.

Case study: Ryan thinks about moving out

Ryan studies full-time and works part-time at the local newsagent. He takes home about $250 per week. He is currently living at home but looking to rent a furnished single room in a shared house for $400 a month. He wonders if he'll have enough money for entertainment, let alone emergencies, after he pays his expenses. The only way to find out is to do a budget. After bills, living expenses and rent, he works out he'll have $12.50 a week left over. Things will be quite tight for a while.

Choosing a place

Smart tip

Try to save 10% of your pay for emergencies  like not being able to work for a week, unexpected bills or extra travel costs. You'll be glad of those spare dollars.

The location of your rental property could affect your budget, depending on how close it is to public transport and shops. It could mean you end up paying more for a lot of taxis or for petrol.

Here's where to start looking for places to rent:

  • Visit real estate websites (You can search by suburb, price, number of rooms and type of accommodation (e.g. unit, townhouse or house)).
  • Call real estate agencies in the area to get a current rental list
  • Check rental lists in newspapers or on student notice boards and magazines
  • Ask your friends or work mates

Sharing with flatmates

Smart tip

Put aside some cash to buy groceries and stock up your food on the day you move into your new place.

House sharing is one of the easiest ways to save money when you move out of home. For example, splitting rent and household expenses for a four-bedroom house with three other flatmates could end up cheaper than renting a one-bedroom unit by yourself.

If you're sharing, set ground rules with your flatmates at the start, even before you move in together.

You and your flatmates should decide how to:

  • Pay for bills
  • Share the cost of rent and utilities
  • Share responsibility for household chores
  • Withdraw from the rental lease when someone moves out
  • Pay a shared cost for food as a group, or shop individually

Formal living arrangements

Sharing a lease with your flatmates is called a formal living arrangement.

There are different contracts you will need to sign when you live in a formal arrangement. You will need to sign the rental agreement as well as any contracts for services that are connected to the property like electricity, gas, water and the internet. These contracts are legally binding, so you and your housemates will be legally responsible for paying bills for these services.

Make sure you understand the contract before you sign it. Can you afford the repayments? Check the small print and obligations of the contract. Can you cancel the contract and what happens if you do? Unfortunately, you cannot cancel some contracts just because you have changed your mind.

If you can't pay your rent or bills it may affect your credit report. A poor credit report can affect your ability to borrow money in the future.

Informal living arrangements

Smart tip

In shared households, try not to have your name on all the bills. If the bill is addressed only to you, even if you are sharing the costs, you are legally responsible.

There are times when you rent part of a house from another tenant but have not signed the lease. This is known as an informal living arrangement. You will still need to pay for your rent and for services like electricity and gas. However, there is no legal contract as you have not signed a lease.

In a situation like this, the tenant you are renting from will have signed a written tenancy agreement with the owner of the house or unit. This makes them the 'head-tenant'.

If you are in this situation you should get a written agreement with the head-tenant that covers things like how much rent you will be paying and how shared household costs will be divided and paid. A written agreement can help set agreed rules and can be used to resolve disputes.

Be careful if you allow a housemate to live with you and they are not on the lease or you do not have a written agreement with them. If things don't work out and they move out or stop paying rent, you could end up out of pocket without any way to get the money back.

Moving out checklist

Here is a checklist of things you need to do before you move out for the first time:

  • Utilities - Set up electricity, phone, internet and pay TV connections.
  • Furniture - Find out if the place comes furnished, or budget for new or second-hand furniture.
  • Renter's Insurance - Get online quotes if you want to insure your home contents. If you have car insurance, this will also need to be updated as the new address may mean your insurance premium will go up or down.
  • Budget - Complete a budget for your moving expenses, making sure you have enough money to cover the one-off and ongoing costs.
  • Removalists - Book and pay for a removalist, or arrange to get help from family and friends.
  • Research the area - For example, where is the closest bus stop or train station, supermarket, ATM, petrol station and doctor? Are they within walking distance?
  • Bills and loose ends - Pay off any existing bills before moving, and return DVDs or library books and cancel your memberships if necessary. You don't want late fees hanging over your head.
  • Sell unwanted items - Get rid of any unwanted items you have to raise extra money for items at the new place.
  • Redirect your mail - Make a list of everything that has your address on it or organisations that will need to be notified of your new address in order to send mail to you, such as your driver's licence, your bank statements, your employer and your Medicare card. Moving Services contains a comprehensive list of who to notify.
  • Look into medical and ambulance cover - Once you move out of home and begin living independently, you may no longer be covered by your parents' medical insurance.

Case study: Charlie gets some useful advice

Charlie's older brother told her that moving out could be expensive. He suggested ways she could save money.

  • Offer to buy lunch for friends who would help her move house, instead of paying for a removalist.
  • Shop around for furniture at local second-hand stores.
  • Contact family and friends to see if they had any second-hand furniture or kitchen goods that they didn't need.
  • Buy only the essential items to begin with. For instance, she could use the local laundromat rather than buying a washing machine.

Charlie took her brother's advice and saved almost $500 in the move. She used the money to pay for some of her uni books.

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Last updated: 13 Jul 2016