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Old 08-26-2017, 09:38 AM
Status: "I don't know." (set 4 days ago)
 
4,422 posts, read 4,611,738 times
Reputation: 3281

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Quote:
Originally Posted by hellomoving12 View Post
My husband and I rent a 600-sq ft 1-bedroom apartment in California with our 2 dogs. When we first moved into the place, our financial situation was dramatically different, and we make nearly double what we did when we first moved in.

To give you a better perspective on this, right now we spend about 15% of our monthly net income on rent.

Our place has carpets (which have seen WAY better days - that's having 2 dogs for ya!) And not gonna lie - I'd love laminate floors, some semblance of a yard, and a 2nd bedroom for a home office. (I don't see us having kids anytime soon, so we don't need a nursery). All of this comes at a price - and would turn that 15% of our income into around 25%-27% going towards rent. A fairly decent increase.

I think of all the "other" things we could do with that money - create a bigger nest egg, save for a down payment on a home, take an epic 3 month roadtrip (something we've talked about doing), etc. Right now, we live super comfortably and it's been nice, but I almost feel like if we stay, we need to figure out how to manage our money better, and give it more purpose.

What percentage of your income goes towards your home or apartment? And what would you do if you were in our shoes? Stay in the tiny 1-bedroom with less than stellar carpets, or consider an upgrade?
I am in your shoes. My income has increased considerably since I initially rented my apartment. It is tiny and in a good neighborhood. I thought about upgrading to a one bedroom but decided against it. I am in prep mode for the future.

If you can afford it, I would say upgrade. I think being frugal should have purpose. All of my money has been accounted for; I cannot afford it. I have carpet too. Stanley Steamers works wonders. They can make your carpet look brand new. Good luck!
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Old 08-26-2017, 09:56 AM
Status: "I don't know." (set 4 days ago)
 
4,422 posts, read 4,611,738 times
Reputation: 3281
Quote:
Originally Posted by NYC refugee View Post
Go on the road trip. Then come home and make some life decisions. The people telling you to be wary are right. Nothing is logical any more and it's not like you can rent a place and count on a fixed increase every lease renewal, nor can you count on a pay increase. I was in your position and saved the money for the future, but the future pulled the rug out from under everybody and I never got the road trip or the house or anything else. So in hindsight, I'd say the life experiences (trip) are not unimportant. The space depends on what you want it for. If barbecues and an office are important to you, then you should have them. It's up to you how important they are and if something else might be more important.
I agree with this post. I am not sure how old the OP is but I would consider the trip if that is what you want to do. There are no guarantees. It takes a life time to build savings and a day to lose it all. At the end of the day, you really have to decide what is important to you. What you can do today, you may not be able to do tomorrow. If an opportunity presents itself and that is what you want, I say go for it.

I also had the rug pulled right from under me. No kidding. I have no words. It takes some much to rebuild. So much sacrifice is involved but I do not feel deprived because of the experiences I have allowed myself to partake in my past.
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Old 08-26-2017, 10:32 AM
 
Location: N of citrus, S of decent corn
30,569 posts, read 38,145,111 times
Reputation: 49016
I would not be happy in 600 sq Ft with 2 dogs and a husband, but it sounds like you are still ok with it.
Home ownership has its headaches, but a house is an asset just like money, rather than throwing your money down a hole. How about you stay put, but explore the possibility of buying if the right place comes along? Looking is free.
It would be nice if you had a dedicated office, and a fenced in yard for the dogs. Once you find it, run the numbers and see how you feel.
We don't know enough about you to say for sure. Would you like a garden? Or a porch to sit on? Homes are very personal. Some want nothing to do with any kind of maintenance and some like it.
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Old 08-28-2017, 06:52 AM
 
2,380 posts, read 1,231,166 times
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OP moving:

I'd absolutely stay where you are.

I'd save the difference towards either retirement or buying my own house where I could change the carpets if I wanted.

I gather you are Younger as you mentioned the ability to have kids. In your 50s for instance, that option is pretty much gone unless you adopted. So I'd say save it towards retirement.

You DON'T Know what will happen in the future. I had several severe medical issues set in in my late twenties and much of my 30s, I actually ended up homeless living under a RR bridge. I went through a healthy savings and retirement from my earlier 20s, which due to the recently ongoing recession since the late 80s would have grown to about half what was expected when I socked it away this year's ago.

Now I'm scrambling to save for retirement in my 50s, and until some things are cleared up, won't be able to do more than I am now, which is not what I'd like to be able to do.

In short, you DON'T know what the future holds, so SAVE that difference and stay where you are!!!

To answer your question, our mortgage is 19% of our gross income, seen to by the mortgage company. It's about 22% of net, and we have another 20% on top that for debt for home improvements! That was a stupid move on our part, but it will be all clear in 3.5 years. I look at it as good debt, hopefully increasing our homes value, won't get it all out, but will get some back and it makes our house more comfortable for us.

So I vote to save the money and invest for retirement, as well as save in accessible accounts in case you need it.

Best of luck, you can always spend more after you have very healthy savings of several types for the future. It could be to build accessible savings, retirement savings, down payment savings for a future house, etc.

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Old 08-28-2017, 08:36 AM
 
4,801 posts, read 5,407,971 times
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OP, any thoughts on what responses you've seen so far??

Some people are advising you to do what they did, others are suggesting you do not do what they did. I always find that last part interesting. Some people who say bigger isn't always better have not increased their space. Yet I also sometimes give the side eye -- or at least need to know more about the WHY of certain advice when people who have had the bigger house -- tell someone else not to go bigger. The people telling you not to get a bigger place -- are THEY living with a situation of 2 dogs and 2 people in 600 sq. ft. You didn't say you wanted to go up to a McMansion.

Spending 25% of your NET on rent is NOT a lot of your available finds. And it would still allow you to save.

You never said WHEN this 3 month road trip would be. IF you're thinking of doing it soon, I second the suggestion of going on the trip, and using some of that time to really think about the options you have. For example I'm not clear on just how much you want to move. Do you HATE the place, and can't take it another day, your grumpy because the space is just too tight? Or, "oh, m, this carpet needs cleaning." You could get a bigger place AND still save. Perhaps just not as quickly.

You didn't say how much saving you already have. Depending on your job situation -- If you have six months or more already saved as a true "I never touch it emergency fund" -- I'd.....get the bigger place I want, continue saving for whatever goals I set, and enjoy my new bigger place. A year's expenses saved is a higher goal, but I'd still do it if I just had 6 months and just save more after I moved into the bigger place. IF something should happen you've got a year's expenses saved. Once your emergency fund is at a year's expenses (or 6 months if you're comfortable with that, you can keep adding to building it up for anything else you're saving for. IF you want a house eventually, or car or trips, or whatever. And you're also -- all along -- saving for retirement.

Personally I did buy a house. But I also know some people who've saved more cash because they got a good rent situation -- and are in their 70s and NEVER owned a house. They still have plenty of money though. So you don't HAVE to buy a house ever IF you don't want to.

Last edited by selhars; 08-28-2017 at 09:31 AM..
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Old 08-28-2017, 01:19 PM
 
Location: Lower East Side, NYC
1,040 posts, read 639,822 times
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I live in 250 sq ft and my rent vs gross is 21.6%. I'd stay and save for the future (ie home ownership and retirement). Rather be safe than sorry. If you don't -need- the extra space, then don't bother if it means increasing your rent.
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Old 08-28-2017, 02:27 PM
 
520 posts, read 962,265 times
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We moved to a bigger house at a higher cost when we were living in CA and I thought it was a huge improvement in our lifestyle and a decrease in stress. But it's not because the house was bigger, it's because the house was in a better neighborhood. Our previous house was in a neighborhood where people kept roosters and left their stupid barky dogs outside all night. The house didn't have A/C and didn't seem like it had any insulation either, so on hot days we had to leave the windows open at night to cool off. The more expensive place was in a more upscale, much more quiet neighborhood and was walking distance to a lot of restaurants and bars, plus 10 miles closer to my job. The extra space was just a bonus.

I don't see extra space being the key to happiness, especially in CA where people don't spend a lot of time in their homes. Maybe if you guys are total homebodies and you want a dedicated game room and your husband wants someplace where he can shut the door and play music or something, but space in and of itself is just more to clean IMO. However, if the upgrade will get you a better location/shorter commute/better neighbors then by all means I think it's worth it. I was at the end of my rope with our crappy cheap house. I slept better in the new place from the very first night.

We're in Phoenix now and my rent is about 15% of my gross. I don't love this apartment and we have some crappy noisy neighbors but nobody has a rooster and there are no barking dogs, plus we have A/C now and can just shut the windows. In other words, it's good enough, so I'm holding out until my husband gets a job and we can buy a house. I see no reason to spend more money renting someplace else because I don't think it will make my life any better.
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Old 08-28-2017, 03:14 PM
 
128 posts, read 41,638 times
Reputation: 50
Quote:
Originally Posted by hellomoving12 View Post
My husband and I rent a 600-sq ft 1-bedroom apartment in California with our 2 dogs. When we first moved into the place, our financial situation was dramatically different, and we make nearly double what we did when we first moved in.

To give you a better perspective on this, right now we spend about 15% of our monthly net income on rent.

Our place has carpets (which have seen WAY better days - that's having 2 dogs for ya!) And not gonna lie - I'd love laminate floors, some semblance of a yard, and a 2nd bedroom for a home office. (I don't see us having kids anytime soon, so we don't need a nursery). All of this comes at a price - and would turn that 15% of our income into around 25%-27% going towards rent. A fairly decent increase.

I think of all the "other" things we could do with that money - create a bigger nest egg, save for a down payment on a home, take an epic 3 month roadtrip (something we've talked about doing), etc. Right now, we live super comfortably and it's been nice, but I almost feel like if we stay, we need to figure out how to manage our money better, and give it more purpose.

What percentage of your income goes towards your home or apartment? And what would you do if you were in our shoes? Stay in the tiny 1-bedroom with less than stellar carpets, or consider an upgrade?
I would stay there unless you need the space. As a couple others have said, renting is just money wasted, so there is no need to pay more if you don't need to. If you need the space or the neighborhood goes bad that's a completely different story. When I was renting, my last apartment it was about 15% of my income and I stayed there a few years until I was able to save up a down payment for my house. I'm actually glad I made that decision because it allowed me to enjoy life and still be able to save a lot since my bills were such a small percentage of my income. So I would say stay save up and probably take a vacation or do something fun with some of your free money.
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Old 09-05-2017, 02:46 PM
 
8 posts, read 3,654 times
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Super interesting to come back and read the replies.

The roadtrip is something we've talked about doing in the future - not something we can actually do right now.

Our apartment has had the same carpets for who knows how long. We've been in the space for almost 6 years, and they just look bad and feel unsanitary to me. Our dogs have multiple accidents a year on them. We have a portable steam cleaner to provide immediate relief, but some of the stains are just not going anywhere, and there are several of them. It makes me embarrassed to have company over.

Our property manager will allow us to replace the carpets for an increase of $50/month to our rent, but the hassle of moving everything out, and also knowing the carpets could just as easily get wrecked again makes me hesitant. We have put down area rugs but it just kind of masks the problem, and some of the stains are in awkward locations that couldn't really be covered by an area rug.

I don't think they would allow us to pull up the carpets and put down laminate.

We've done carpet cleaning, but some of the deeper stains just re-surface, as I think some of them went down pretty far into the padding.

We're paying under market value for our place right now - a place like ours could go for at least $200/month more than what we pay now.

I work from home, so I'm always here, and maybe that's why it's grating on me a bit more. My home office is in our bedroom, and I have a gap of maybe 8 inches between my office chair and the foot of the bed.

Our income has nearly doubled since we first moved into this place. It's a lot to think about. I don't have many other complaints about our current place, minus the flooring situation, but those perks I mentioned wanting are things I would certainly love to have.

Regarding home buying, while I definitely want to start putting steps towards that, I don't know yet where we're ultimately going to settle. We may even leave California in a couple of years.
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Old 09-05-2017, 07:04 PM
 
3,822 posts, read 8,149,738 times
Reputation: 2934
I would stay put until you are somewhat close to having kids. When kids are within a year or two, buy a house. Save up for the down payment now while the livings cheap and easy.
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