← Money Basics After High School · about 45 min

Renting your first place

Leases, deposits, roommates, and the costs nobody mentions.

The 30% guideline

For decades, the U.S. government has used 30% of income as the line for affordable housing. If rent and utilities take more than 30% of your gross (before-tax) pay, you're called "cost burdened". Over 50% is "severely cost burdened".

It's a guideline, not a law. In expensive cities lots of people go over it, usually by getting roommates or cutting other spending.

Lease words

Lease: A legal contract, usually for 12 months. Breaking it early can cost you several months of rent.
Security deposit: Money held by the landlord (often one month's rent) to cover damage. You get it back when you move out, minus damage beyond normal wear and tear.
Application fee: Paid to apply, usually for a credit and background check. Not refundable.
Co-signer / guarantor: Someone (often a parent) who promises to pay if you don't. Common for first-time renters with no credit.
Joint and several: Words that mean every roommate is responsible for the whole rent. If one roommate leaves, the rest still owe all of it.

Worked example: Maya's first apartment

Maya earns $17/hour full time. She and a roommate find a 2-bedroom for $1,400 a month. Utilities and internet are about $200, deposit is $1,400, the application fee is $50, and renters insurance is $15 a month.

Gross pay per month$17 × 40 × 52 ÷ 12 = $2,946.67
30% guideline$2,946.67 × 0.30 = $884.00
Maya's monthly housing cost($1,400 + $200) ÷ 2 + $15 = $815
Share of her gross pay$815 ÷ $2,946.67 ≈ 27.7%
Cash to move in, her share($1,400 rent + $1,400 deposit) ÷ 2 + $50 = $1,450

With a roommate it fits under 30%. Alone, $1,400 + $200 + $15 = $1,615 would be about 55% of her pay: severely cost burdened.

Check a real listing

Find an apartment listing near you and plug in the real rent.

Can I afford this place?

Your gross pay per month

Before taxes. Hourly × hours per week × 52 ÷ 12.

Total rent

People splitting rent

Utilities + internet (total)

Your renters insuranceper month

Security deposit (total)

Your monthly housing cost—

Share of your gross pay—

30% guideline: your max—

Cash to move in (your share)—

Move-in cash = first month's rent + security deposit + a $50 application fee, split evenly. Some landlords also ask for last month's rent.

Hidden costs and protecting your deposit

Utilities: electric, gas, water, trash, internet. Ask the landlord what past tenants paid.
Furniture, kitchen basics, cleaning supplies, and moving costs (truck, gas, helpers' pizza).
Parking, pet rent, and pet deposits.
Take dated photos and video of every room on move-in day and email them to the landlord. Do it again on move-out day.
Get every promise in writing ("we'll fix the dishwasher") before you sign.
Roommates: write down who pays what and when, and how you'll split utilities, before you move in.

Practice

You earn $2,500 a month before taxes. What's the most rent and utilities you should pay under the 30% guideline?
Show answer
$2,500 × 0.30 = $750.
Rent is $1,800 split evenly among 3 roommates. What's each share?
Show answer
$1,800 ÷ 3 = $600.
Move-in requires first month ($1,200), last month ($1,200), and a deposit ($1,200), split between 2 people. How much does each person need?
Show answer
$3,600 ÷ 2 = $1,800 each, before any moving costs.
Your roommate moves out in month 4 of a joint lease. Rent is $1,600. What do you owe each month now?
Show answer
All $1,600. With a joint lease, each tenant is responsible for the full rent.

Can you…

Find a rent limit using 30% of gross pay
Add up the cash needed to move in
List three ways to protect your security deposit

Sources and dates

HUD Office of Policy Development and Research: Defining housing affordability · as of 2017 article; standard still in use Oct 2026