So you’ve decided to leave the nest and start renting? Exciting! Renting often means greater freedom and independence, particularly if you’re moving out of your parents’ place for the first time. But it’s not without its challenges.
Becoming financially independent and managing a flat’s expenses (as well as your own) may seem complicated, but we can help. Give yourself the best shot at not having to move back home in six months’ time!
- Your flat’s finances
- Put everyone’s name on the bills
- Open a flat account
- Set flat guidelines
- Your finances
- Set up your bank account
- Get contents insurance
- Budget (and save)
- Ask for help
Your flat’s finances
Put everyone’s name on the bills
Tenancy agreement, power connection, internet plan…there’s a lot of signing involved with setting up a new flat. And while we all want to think the best of people, not everyone sticks to their word. Keep things fair and accountable by getting everyone’s name on all the bills. If you can’t get their name on the tenancy agreement, at least get them to sign a sub-letting agreement (even if they’re your mate). If things go wrong, you’ll be glad you did.
Open a flat account
Most bills require you to make just one payment – meaning if you’re renting with three other flatmates, your landlord will usually expect one rent payment, not four separate payments. The easiest way to do this is to set up a flat account where you and your flatmates can transfer money into from your individual accounts. And pay your bills directly from your flat account.
Our Streamline account1 could be ideal for flatting and you can set it up how you want. Your whole flat can have control over the finances, access to FastNet Classic internet banking and an EFTPOS card. Or you can set it up as a two-to-sign (no EFTPOS or online payments, but no dodgy flatmate cleaning out the account either!).
Set flat guidelines
To some, the idea of imposing any rules on newfound freedom is enough to make them pack in this whole renting thing and move back home. But all it takes is one flatmate taking advantage of another for everyone to start craving some law and order. Some topics you may want to cover are:
- Hosting parties and who covers the cost of any damages.
- Overnight guests (the odd sleepover might not hurt, but regular guests can add a fair bit to your water and power bills – so much so they might be required to chip in).
- Communal food (half a loaf of your bread being eaten by your flatmate everyday can really take a toll on your student budget).
- Locking the door before leaving the flat (don’t always assume someone’s home).
- Cleaning rosters (the bathroom and kitchen do get dirty!)
Set up your bank account
If you’re studying or doing an apprenticeship, you may be eligible for the ASB Tertiary Student package2. Enjoy perks like no base or transaction fees for the lifetime of your account and free fries daily every time you use your Tertiary Visa Debit card at McDonald’s®. Also, ask us about an interest-free overdraft (up to $2,000) or a credit card with a $1,000 limit and no account fee for a year.
But if you’re jumping straight into the workforce, the ASB Job starter’s package3 can help set your new life in motion.
Get contents insurance
While you lived at home, your contents were probably covered by your parents’ insurance. Now it’s up to you to cover them.
Why get contents insurance4?
Accidents happen, and you don’t want to get caught out with a huge expense! Contents insurance is important as it covers your personal items for sudden accidental loss or damage whether you’re at your flat, or if you’re out and about anywhere in New Zealand. You may not realise how much you have that’s worth protecting (e.g. a $1,000 laptop, a $1,000 phone, $5,000 worth of clothes and shoes) – it all adds up! You want to make sure you have the cover to replace them if something happens. Contents insurance also gives you cover for legal liability. This means if you accidentally cause damage or loss to someone else’s property, or injure someone else and are liable for it, your contents insurance could cover you up to $1,000,000.
Budget (and save!)
Sticking to a budget will help you pay your bills on time and still have some left over for those midnight Maccas runs. Use our Track My Spending tool to see what you’re spending your money on.
Struggling to save? ASB Save the Change could help with this. It rounds up the amount you spend per transaction (e.g. to the nearest dollar or $2) and then puts the difference into your ASB savings account.
Ask for help
Managing your own finances is a huge learning curve and you may find that you run into trouble. Reach out and ask for help if this happens – you can ask someone you trust, reach out to the Citizen’s Advice Bureau or contact your bank. You can also keep up to date with this blog to learn about budgeting and managing your money; our money tips category is a great place to start.