The rent is $900. Moving in costs $1,850.
The story so far You found the apartment near the bike shop: $900 a month. You earn $3,000 a month before taxes. The landlord says yes, and then hands you the move-in bill: the first month's rent, a $900 security deposit, and a $50 application fee. That's $1,850 before you've slept there one night. Then come the lights, internet and renters insurance. This lesson shows how much rent you can really afford, what you pay to move in, what a lease locks you into, and how to get your deposit back when you leave.
Renting means paying a landlord each month to live in their place. The lease is the contract with the rules and the price.
Rent is the biggest bill most young adults have. Pick one that's too high and every other money goal gets squeezed.
Keep rent near 30% of your income before taxes, save the move-in cash first, read the lease, and photograph everything on move-in day.
Leasing agents show units and check applications. Property managers run buildings for owners. Real estate analysts figure out what rents a building can earn.
What you're looking at: the door to apartment 2B and the bill you pay before you get its key. The rent is $900 a month, but moving in takes $900 + $900 + $50 = $1,850.
Renting, step by step.
Finding a place is the fun part. The money part has four pieces: the rent you can afford, the cash to move in, the full monthly cost, and the lease you sign.
How much rent can you afford?
Two rules of thumb. Yours: the 30% rule says keep rent at or below 30% of your monthly income before taxes. The government counts anyone above that as "cost-burdened." The landlord's: many ask that you earn at least 3 times the rent. They're close: 3 times the rent is the same as rent being about 33% of income.
- Your 30% cap
- $3,000 × 0.30 = $900. The apartment is right at the limit.
- Landlord's check
- 3 × $900 = $2,700. You earn $3,000, so you pass.
People splitting it
The line marks 30% of $3,000, which is $900.
What you're looking at: a rent checker for someone earning $3,000 a month before taxes. Slide the rent and pick how many people split it. The bar is your share of rent as a part of your income, with a line at 30%. With roommates, it assumes each person earns $3,000 too.
The cash to move in
Before you get keys, most landlords want the first month's rent, a security deposit (often one month's rent), and an application fee for the credit check. Some also want the last month up front. A low credit score, like you saw in Lesson 4.1, can mean a bigger deposit. Save this cash before you start touring, and don't touch your emergency fund for it.
- Move-in bill
- $900 rent + $900 deposit + $50 fee = $1,850.
The real monthly cost
Rent is only the start. Add utilities (electricity, gas, water, internet) and the renters insurance from Lesson 6.1. Ask the landlord which utilities are included and what last winter's bills were.
- Each month
- $900 rent + $110 utilities + $15 renters insurance = $1,025.
Reading the lease
A lease is a contract, so read it all before signing. Look for: the term (usually 12 months), the day rent is due and the grace period before a late fee, the late fee, what it costs to break the lease early, who fixes what, and the rules on pets and guests. If your income is too low for the 3 times rule, some landlords take a guarantor: someone who promises to pay if you don't.
- Your lease says
- 12 months. Rent due on the 1st, 5-day grace period, then a $50 late fee. Breaking it early costs 2 months' rent: 2 × $900 = $1,800.
Roommates
Splitting a bigger place is the fastest way to cut rent. But on most shared leases, each roommate has joint liability: if one roommate leaves, the landlord can ask you for the whole rent. Write a roommate agreement: who pays what, by when, and what happens if someone moves out.
- A 2-bedroom
- $1,400 rent: $1,4002 people = $700 each. That's $900 − $700 = $200 less a month, or $200 × 12 = $2,400 a year.
- If your roommate leaves
- The landlord can still ask you for all $1,400.
Getting your deposit back
On move-in day, walk through with the landlord and take dated photos of every scratch and stain. When you leave, the landlord can only take money for real damage, not normal wear and tear like faded paint or worn carpet. State law sets a deadline to return your deposit, often 14 to 30 days, with a written list of anything they kept.
- Move-out
- Worn carpet: $0, that's normal wear. A hole in the wall: $120 to fix. You get $900 − $120 = $780 back.
Two minutes. Just listen.
Tap any line to jump to it.
Lease check.
Eight renting moments. Each one gives you the facts. Do the math or pick the rule, then tap your answer. One try each.
What you're looking at: made-up renting situations. Each lists the facts, then asks one question.
The logic, step by step.
Four checks before you sign anything.
Step 1: Your rent cap
- You
- $3,000 × 0.30 = $900.
Step 2: The landlord's check
- $900 apartment
- 3 × $900 = $2,700, which is less than $3,000. You pass.
Step 3: Move-in cash
- Apartment 2B
- $900 + $900 + $50 = $1,850.
Step 4: The full monthly cost
- Each month
- $900 + $110 + $15 = $1,025.
Worked example: alone or with a roommate?
- Alone. $900 rent + $110 utilities + $15 insurance = $1,025 a month.
- With a roommate. A 2-bedroom is $1,400 with $140 of utilities. Your half: $1,400 + $1402 = $770, plus your own $15 insurance = $785.
- The difference. $1,025 − $785 = $240 a month, or $240 × 12 = $2,880 a year.
- The catch. Joint liability: if your roommate leaves, you could owe the full $1,400.
- The call. Roommate, if it's someone you trust and you both sign a roommate agreement.
The hermit crab rents its home.
A hermit crab doesn't grow its own shell. It moves into an empty one left by a sea snail, lives there while it fits, and moves out when it outgrows it. It picks a shell that fits its body now, not the biggest one on the beach.
What you're looking at: an illustration, not data. A hermit crab that has outgrown its small shell, heading to a bigger empty one.
Why this sticks. A shell that's too big is heavy to carry and hard to defend. Rent that's too big does the same to your budget. Pick the place that fits your income now, leave it the way you found it, and move up when you grow.
The page you'd copy down.
- 30% rule: rent ≤ income before taxes × 0.30. $3,000 × 0.30 = $900.
- Landlord's 3 times rule: income ≥ 3 × rent. 3 × $900 = $2,700.
- Move-in cash = first month + security deposit + fees: $900 + $900 + $50 = $1,850.
- Real monthly cost = rent + utilities + renters insurance: $900 + $110 + $15 = $1,025.
- Lease: check the term, due date, grace period, late fee, early-break cost, repairs, pets. A guarantor can help if your income is short.
- Roommates cut rent ($1,400 split 2 ways = $700) but joint liability means you can owe the whole rent.
- Deposit: photos on move-in; landlords can charge for damage, not normal wear and tear; state law sets the return deadline.
Fill in the blanks
Grab a friend or a study group.
Listing hunt
Everyone picks a real rental listing near campus. Using a $3,000 income, figure out the 30% check, the 3 times check and the move-in cash. Who found the best fit?
Write the roommate agreement
In pairs, write one page: how rent and utilities split, the due date, guests, chores, and what happens if one person moves out.
Lease scavenger hunt
Find a sample lease online. Race to find the late fee, the grace period, and the cost to break it early.
Just you and your money.
These stay on this device. Nobody else sees them.
Exam-style questions.
Written the way a college exam would ask them. Each right answer on the first try is worth 10 xp.
On the job: you're the leasing agent
Jasmine wants to rent an apartment in your building. Here are her numbers:
- She earns $3,600 a month before taxes.
- She wants a 1-bedroom that rents for $1,250 a month.
- Your building's rule: income must be at least 3 times the rent.
- You also have a 1-bedroom for $1,200, and a 2-bedroom for $1,600 that two people can share.
Your task: does Jasmine qualify for the $1,250 apartment? If not, what are her options?
See a model answer
The $1,250 unit: 3 × $1,250 = $3,750. She earns $3,600, which is $150 short, so she doesn't qualify on her own.
Option 1, the $1,200 unit: 3 × $1,200 = $3,600. She qualifies exactly, and it's $50 less a month.
Option 2, a roommate: the 2-bedroom split two ways is $1,6002 = $800 each. That's 3 × $800 = $2,400 needed each, and she's well over. She saves $1,250 − $800 = $450 a month, but she'd have joint liability for the full $1,600.
Option 3, a guarantor: someone with higher income signs on and promises to pay if she can't.
Also: by the 30% rule, her cap is $3,600 × 0.30 = $1,080. Even the $1,200 unit is over it, so the roommate option is the easiest on her budget.
Where you live, and what's next.
What you're looking at: a map of where this lesson fits in the course. Read it left to right: the lessons it builds on, this lesson in the middle, and the lessons that come next.
- Back · Unit 4Your credit score
- Back · Unit 3Give every dollar a job
- Back · Unit 6Insurance: health, car and renters
- You are hereRent your first apartment
- Next · Unit 7Buying a car
- Later · Unit 7Renting vs. buying a home