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How Much Money Do You Need to Move Out in 2023?

Updated: Mar 29

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One of the biggest stages in a young adult's life is moving out and getting an apartment on his or her own. But over the past decade, it has become far more common for college students to move back in with their parents following graduation. The reasons for this vary but are largely attributed to factors like student loan debt and high rent prices.

One of the most popular questions out there among Americans looking to move out on their own is how much in savings they'll need in order to feel comfortable on their own.

I've got you covered. Here's how to prepare financially to move out.

How much money do you need to move out?

You should plan on saving between $8,000-$12,000 before you move out on your own. In reality, this figure depends on a number of variables, including:

  • Your geographic location and average rent prices in your community

  • Whether you will be moving in with a roommate, significant other, or living on your own

Generally, to avoid any sort of financial distress, you'll want to make sure that you earn more than three times your monthly rent (and ideally four times if possible). This is where your geographic location plays a role. In New York City, where it is uncommon to find apartments for under $3,000, you'll need to earn at least $9,000 per month to comfortably afford your own place without roommates.

When I moved out of my parents' house in May 2020, the following was true about my financial situation:

  1. My monthly income was nearly 10x the cost of monthly rent on my new apartment (more like 5x, but I split rent with my then girlfriend)

  2. I had no debt remaining other than a car loan

  3. I had about $10,000 in emergency savings to fall back on if needed

This is not to say that your financial metrics need to look like this before you can afford to live out on your own. But to maximize your chances of being as financially comfortable as possible, you will need to focus on finding an apartment that fits well within your budget. Speaking of budgeting, there is no shortage of budgeting apps out there to help you bring your income and spending more into line.

What can you learn from my experience? For one, moving in with someone that can share rent with you is a game changer. And even if the totality of your rent was 3x your income, with a partner or roommate, you'll be closer to 6x if you split rent equally.

Moving out expenses

Remember - you'll need money for more than your rent when you move out. Other expenses to prepare for include:

  • Security deposit

  • Furniture

  • Utilities

  • Food

  • Renter's insurance

1. Security deposit

Most apartment landlords will mandate that a security deposit as collateral for approving you for an apartment. States have laws limiting how much a landlord can charge for a security deposit, but I think that when I left home, it was equal to one month's rent.

And if you take care of your apartment as your own, you shouldn't have a hard time getting your deposit back.

2. Furniture

Presumably, you'll need to furnish your new place. Now, your family may help you out here and let you have older pieces, but you'll likely still need to buy some furniture to supplement what you have.

I recommend that you spend as little as possible. Consider browsing sites like Facebook Marketplace and Craigslist to see what type of deals you may find. You don't know how long you'll be in your apartment, and any new furniture you buy now may not fit the aesthetic of your first house anyway.

3. Utilities

This varies from apartment to apartment, but you likely will be responsible for at least some of your monthly utility bills. My first apartment covered heat and water, which was awesome, since I only had to pay my electric bill.

If you find a place that covers your utilities, remember to consider that as a factor when comparing rent prices from apartment to apartment.

4. Food

While not directly a "moving out expense," you'll need to prepare to buy your own food, potentially for the first time. Just something to prepare for.

5. Renter's insurance

In most instances, you'll be responsible for purchasing and maintaining renter's insurance for as long as you live in your apartment. Renter's insurance isn't expensive. I think it cost me about $100 per year I had to buy coverage, and it covered me in the event of fire, theft, and other negative events outside of my control.

Are you ready to move out?

To truly decide whether you are ready to move out or not, I recommend that you ask yourself the following questions.

1. What is your credit score?

In almost all situations, landlords will place a heavy emphasis on your credit score and history. So if you have either subpar credit or no credit history at all, you likely are not ready to move out on your own.

You may still qualify if you are able to find a loan cosigner, but I recommend you ask yourself if you really feel ready to take on a rent payment each month. Consider checking out our how-to guide on achieving an 800 credit score.

2. Can you afford furnishings?

Another hidden expense that you'll want to consider is the furnishings in your apartment or new home. When you move out, particularly if you are leaving your parents' home, you'll generally need to purchase or find furniture for your new place.

When my now wife and I moved in together a few years back, we started off with a combination of our families' old furniture and portable kitchen appliances. Then, after we got married and bought our first home in 2022, we used some of those proceeds to help furnish our new home.

3. Are you looking to rent for the short or long term?

Another question that you should ask yourself when planning to move out is whether you are looking to become a renter for the short, medium, or long term. Those looking to rent for the longer term may not need as much cash saved up right off the bat, especially if your rent payment is less than 3x your monthly income.

For those looking to rent for a year or two before buying a house, you may consider saving up more money for your eventual home purchase. If your rent is well below what you can afford, though, you may be able to get away with saving a little less.

4. What are your moving expenses?

If you're planning on moving some distance away, you'll want to remember to budget for any moving expenses that you may incur. Of course, if you are moving a short distance, or decide to move on your own, you can save a good bit of money.

According to Forbes, the average 100-mile move with two movers costs about $1,400. The moral of the story? Moving is expensive, so you'll want to be prepared for it.

The house that I moved to from my first apartment was only about two miles away, so I rented a U-Haul truck and moved our possessions with the help of family and friends. It likely saved hundreds of dollars.

5. Will you live with a roommate?

At some point, you will need to decide whether or not you're willing to live with a roommate. Of course, there are both pros and cons to doing so. As far as pros go, there is the unmistakable potential to save money, and potentially a lot of it.

But keep in mind that in return for saving hundreds of dollars per month, you will be forgoing privacy and having a place all your own.

How I saved to move out

Now that you know how much money you'll need to move out, it is time to put your plan in motion.

I prepared financially for about a year before I moved out of my parents' house for good in May 2020. Here is how I did it.

1. Take stock of your income

The first thing I did was to compare my monthly income to rent prices in my area. I found that the average rent was about $1,100 at the time, so I began to put that money in a separate savings account each month. This helped me to understand how much money I'd have left each month after paying rent.

If I felt comfortable, I knew that I'd soon have enough money to move out on my own. And if not, I still had plenty of time to continue saving money for these expenses.

2. Use a high-yield savings account

If you're looking to earn a little bit of interest on your savings in the meantime, a high-yield savings account can be a great way to help accomplish this goal. I'm a huge fan of earning as much interest as possible, especially in a high-inflation environment.

There are a lot of good ones out there, but I recommend CIT Bank's Savings Connect in particular. At last check, CIT Bank's Savings Connect offered 4.20% APY, which will certainly help you grow your savings balance a little bit more quickly.

3. Buy furniture and other needs over time

I do not recommend waiting until you move in to buy all of your furniture and other needed items. My then girlfriend and I accumulated things like kitchen appliances, furniture, lamps, and other items starting a few months before we actually move in. This way, we didn't have to part with hundreds or thousands of dollars all at one time.

The bottom line

Moving out isn't cheap, but with enough savings and preparation, it is a financial goal that can be achieved early in life. And once you decide how much money you'll need to move out, you can turn to work on building your savings up!

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About Nathan Zarcaro

Nathan Zarcaro is the founder of The Student Debt Destroyer and is passionate about personal finance related causes.  A 2018 graduate of Providence College's Liberal Arts Honors Program, Nathan studied Finance, and worked for one of the world's largest asset management firms before starting his own consulting practice.  In his free time, Nathan enjoys playing golf and traveling with his wife Brigid.

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