Living on your own for the first time might be a daunting task. With so much to worry about, from bills to groceries to rent, even managing your own taxes, it can feel like you’re being pulled in a million directions. It’s a lot to handle, and it can be challenging to know where to start and what tips will work best for you. It’s easy to make poor financial decisions because we don’t have anyone checking in to make sure we’re making good choices. The good news is that you’re not alone, everyone struggles when they’re living alone for the first time, but we’re here to help. In this guide, we’ll explore how you can manage your finances when you’re living on your own for the first time, as well as other tips to help make the transition easier.
Where To Start
The first thing to do is figure out what you need. When you’re living on your own for the first time, it’s important only to buy what you know you’ll need. There are many different things that can distract you from the task at hand, but if you focus on one thing at a time, it won’t be so daunting.
If you know that all of your bills are paid, and there’s enough money in your bank account for groceries, then it might be time to make a list of everything else that is needed in order to live comfortably. We recommend starting with food, toiletries, household items, and clothes. Once the essentials are covered, then go ahead and get anything else that would make moving into your new home easier or more comfortable.
What You Need To Know About Taxes
As soon as you start living on your own, you’re responsible for the taxes that come with being an adult. Typically, your employer will handle most of your taxes for you by deducting the amounts automatically from your paycheck each month. However, many people like to keep track of things themselves alongside the automatic deductions or just want to learn more to understand taxes better. If you want to learn more about taxes and what they mean for you, check out Wealthsimple and their handy income tax calculator Alberta. This will allow you to understand how much you have to pay and understand what you can do to ensure you’re always compliant with relevant tax laws.
Where Your Income Comes From
The first thing you should do when you’re living on your own for the first time is to figure out where your income comes from. This will help you determine how much money you need and what your monthly expenses will be.
You’ll want to add up the amount of income you’re earning from all sources, including salary, commission, interest, investments, property income, and any side jobs you may have. While most people only have a single source of income when they first venture out into the world to live alone, there are many ways to make money. If you have more than one source of income, it’s essential that you understand precisely how much you have coming into your household.
Where Your Money Goes
It can be challenging to figure out how much money you need, and sometimes it can seem like your bank account is drained as soon as your salary goes in. Let’s start by looking at the basics:
- Food: Groceries, restaurants, and takeout. This is one of your most significant expenses. It’s essential to keep track of what you’re spending on food each week or month so that you know where your money is going. You might even want to set a budget for groceries every month to make sure that you’re not overspending on food.
- Transportation: Your commute, gas, parking, tolls, public transit expenses. If you don’t have a car or use public transportation, this cost will be lower than someone who commutes long distances for work or school.
- Utilities: Electricity, water, internet service provider (ISP), cable TV provider (Cable TV), phone service provider (phone). Utilities are usually fixed costs that renew on a monthly basis, and they typically come with a contract that locks in the price for a certain number of months or years. Utilities are another one of your large monthly expenditures, so it’s vital to keep them under control as much as possible because they’ll continue to increase as time goes on and demand increases from customers like yourself.
The Essentials To Managing Your Finances
When you’re living alone, one of the most important things you need to do is to make sure that your bills are paid on time. This means that you need to know when your bills are due and how much they cost. Setting up automatic payments or reminders in advance can help you stay on top of things. To make sure you don’t forget any bills, it can be helpful to make a list of all the bills that need to be paid monthly (rent, utilities, credit cards). You can also use apps for reminders when your bills are due.
Another way to keep track of your finances is by creating a budget for yourself. This includes setting up a savings account with an allotted amount each month and making sure that there’s enough money left over for groceries or other necessities after paying your monthly expenses. It’s also important to remember that you still have expenses even though you’re living alone, so create a spending plan, so you know how much money you have available per month.
How To Save Money
The first thing you’ll notice when you’re living on your own for the first time is that all of a sudden, you’re making your own decisions. You’re in charge of balancing your life, paying your bills, and grocery shopping. That can be overwhelming.
One of the most important things you can do to save money is to create a budget. Your budget will help you figure out how much money you spend each month so that you know how much money you have left to spend on other necessities. You may find it helpful to have multiple budgets so that you know where all of your money is going every month.
If finding time to create a budget sounds like too much work, for now, try using an app. Apps are great because they give you access to an easy way to track your spending habits and save money by alerting you when there are better deals available or when the product has gone up in price.
Avoiding Common Mistakes
Many people who are living on their own for the first time make the same mistakes. Whether it’s spending too much or not saving enough, these financial errors can lead to a lot of stress and even more debt. As a result, it’s crucial that you stick to your budget or monitor your spending via apps to ensure that you are not leaving yourself short for bills.
Dealing With Stress
It’s not always easy to stay afloat and feel confident when living alone for the first time. The stress of managing your responsibilities can wear on you, and it can be hard to take care of yourself, which is essential in the long term. Here are a few tips to help you better manage your stresses and cares:
- Avoid comparing yourself to others. It’s easy to get wrapped up in feeling like things aren’t going well because you’re comparing yourself with other people who seem more successful or have less responsibility. Remember that everyone is different, and there are many factors that affect how someone manages their life.
- Take breaks often throughout your day. You don’t want to burn out on tasks, so make sure you’re taking some time off every once in a while. We all need some time away from our daily routine, even if it’s just an hour or two each month that we use for ourselves. When you feel overwhelmed, take a break instead of working your way through it.
- Learn how to say no. A lot of people struggle with this one, but saying no is essential when it comes to maintaining good mental health while also being able to say yes when necessary.
Creative Ways To Earn Extra Cash
It’s always a good idea to have some extra cash on hand. That way, when something comes up, you’ll be ready to take care of it. One way to get more money in your pocket is through side gigs. A side gig is simply an additional job or another source of income that you can use to supplement your primary income stream. Side gigs are great because they give you the opportunity to earn more money without having to give up any time with friends and family. When it comes to choosing a side gig to add extra cash flow to your incoming money, there are many avenues you can take. For instance, delivery and rideshare work are typically the most popular options, but you could also pick up freelance work, create an online course, or even sell your photographs to stock photography websites for a passive income.