8 Unique financial advice for living with a roommate

financial advice for living with a roommate Financial advice

College is a time when you can enjoy the freedom of living and dealing finances on your own.

However, to enjoy the freedom, often college goers have to share rent with a roommate because the rent of an apartment is quite expensive, especially when they have to manage other expenses including education cost.

Well, you can get a roommate to share the rent. What’s next!

Living with a different person is not easy.

Because, a different person can have a different mindset, which is quite normal.

But when you are sharing the cost of living in an apartment, you have to be cautious.

How will you know whether or not the person is responsible?

Things to consider when selecting a roommate

Before choosing a roommate, you can ask some questions to get an overall idea of the person’s mindset.

Here you go:

Ask the person’s plan of staying in the apartment. Will be the place he/she wants to study, or party with friends, or play music all the time.
Does the person smoke or use alcohol or drug?
Make sure he or she has a sense of proper cleanliness.
Ask the person’s lifestyle like sleeping habit, work schedule, food preferences, and diseases or allergies. Make sure your lifestyle is compatible with the person you are selecting as a roommate
Ask about the roommate’s preferences about allowing guests like a romantic partner and other family guests. Talk to your roommate about it beforehand and fix how long they are welcome. However, if the romantic partner visits your place on every weekend and you are not comfortable with it, then tell it beforehand.

8 Financial advice for living with a roommate

As I have already mentioned, living with a roommate can be a good idea for college students as their finances are tight. But the idea can be risky as well.

Thus, you should follow some financial advice to avoid the financial mess in your life.

1 Make a lease or agreement

When you rent an apartment, don't make a verbal agreement. Put a written agreement in place. Keeping a lease or agreement can help you to avoid a financial clash.

Putting both parties on the agreement entitles them to some rights.

If some things don't work out, you can get out of it or get the roommate out of the apartment.

2 Discuss things with your roommate before making the agreement

You should talk to your roommate about how all things are to be handled. Who will do the kitchen task, who will do the cleaning, and on which day both of you will give rent, etc.?

Go through the following lines to know about 5 financial things you need to discuss with your roommate prior to renting an apartment:

Determine the amount each person will pay towards the rent: You should discuss with your roommate about the amount each one of you will pay towards the rent. For example , if the rent of the apartment is $1000, then you'll have to share the total amount between yourselves. Now the main problem is to split the rent correctly.

If it is a big apartment, then the person taking the largest room or the best view should pay a good portion of the rent. In case, it is a small apartment and the rooms are of equal size, then you can divide the bill in 2 equal halves. This means both of you will pay $500 each for the rent.
Specify the expenditures each person will take care of: There will be loads of other expenses which you need to take care of apart from rent. Once you start living in the apartment, you'll need t.v, freeze, furniture, etc. But these items will not come for free. You'll have to purchase them. Apart from that, you'll need to pay the utility bills, telephone bill, grocery bill, water bill, etc. This is why you should determine the expenditures each one will be responsible for. For example , if you are paying the telephone bill, then your roommate will be responsible for paying the water bill. Ensure that the bills are paid on time. Otherwise, both of you will get into money troubles and fights in future.
Discuss about the maintenance cost: If you want your apartment to be clean and tidy, then you have to maintain it properly. You'll need to hire a cleaning agency if both of you don't have sufficient time to clean the apartment. So, decide how much each of you will pay for the cleaning expenses.
Discuss the ramification if anyone of you decides to shift: Your room partner may decide to shift to another apartment due to certain unavoidable circumstances. In such a situation, you'll have to pay the entire rent and other bills on your own. On top of that you may be charged with a huge penalty by your landlord. To avoid such a situation, you should ensure that the person leaving the apartment early should pay the penalty.
Discuss about rental insurance: It is better to discuss and take out a rental insurance policy with your partner. This way if there is some damage in your apartment or anything gets stolen, then both of you will not have to bear the extra expenses. The rental insurance will provide coverage for these things

Finally, if your roommate decides to keep a pet in the apartment, then he/she should take care of all the associated expenses. This means that your room partner should pay for the food, health check ups of the pet.

After signing into the agreement, give a copy of the agreement to the landlord.

3 Avoid buying furniture together

Buying furniture separately is a good decision when you are living with a roommate. You can take the furniture when you move out.

There will be no hassle of selling the furniture to share the cost.

Thus don’t split the cost of buying furniture. Discuss with your roommate about buying the furniture needed for the apartment.

It is advisable to buy used furniture instead of a brand new one.

It will help you to save money, and you will also not feel bad when your furniture will be used roughly.

4 Divide expenses with your roommate

As already mentioned, splitting expenses is another important task when you are going to live with a roommate.

Sit with him/her to divide the cost for rent, utilities, cable, internet, groceries, and personal care items.

Also, discuss how and when the bills are to be paid each month.

5 Create a budget

You should create a budget to avoid spending money on unnecessary things.

It will help you to create a savings cushion so that you can manage the cost if your roommate suddenly moves out.

Take advantages of online budgeting app to formulate a budget.

6 Go for individual leases

You can choose an apartment that caters to students by offering an individual lease.

Considering individual lease is hassle-free, because the apartment owner will split the rent cost, utility bills, and other expenses between the renters.

7 Track your expenses to avoid “You-still-owe-me-money”

If you don’t track the expenses that you share with your roommate, you may end up with “You-still-owe-me-money” conversation.

To avoid this type of awkward situation when living with a roommate, take help of free mobile apps to track shared expenses easily. Splitwise, Billsup, Conmigo, Paydivvy, and Track Every Coin are some user-friendly apps that you can use to track who owes what to whom.

8 Maintain an excel spreadsheet to track shared expenses.

How does it work?

Create an excel spreadsheet and put what you paid for and what your partner paid for.

The spreadsheet will tell you who owes what to whom.

As per the report of rent.com, you can end up paying $705 extra per month by living solo in Chicago. Renting solo in Los Angeles can cost you even more, about $831 per month.

Thus, sharing rent with a roommate is beneficial especially for students who deal with limited money.

However, as said before, to live peacefully with a roommate, you have to find a compatible roommate.

How can you find a comfortable roommate?

Select friends, that you already know, as your roommate.
If you are moving to a new city for studying, then you can take help of some websites to find available roommates and apartments.
Research online before signing up for any service to avoid scam and to get potential roommates.

Getting the right roommate is difficult, but you have to try to get the right person to live in a shared apartment.

It can make your he life easier, especially when you are studying. Good luck!