Buying or renting a place of your own is one of the biggest decisions you’ll ever make. Living alone brings plenty of upsides, like freedom and privacy, but it also comes with responsibilities that are easy to underestimate.
We’re talking about the monthly and annual costs of maintaining a home. Before taking this step, it’s wise to understand exactly what you’ll be paying for, so nothing catches you off guard.
Calculate disposable income
The first step is to work out how much money you actually have available each month to cover your expenses.
If you rely on a single source of income, such as your salary, this is fairly straightforward.
If you have several sources, for example, rental income from another property, local accommodation income, investment returns, interest from savings, or social benefits, you’ll need to add them all together and subtract any taxes due. The result is your real monthly disposable income.
This figure is essential to help you understand what you can realistically afford and prevent you from putting yourself under financial pressure by spending more than you earn.
Household expenses
Keeping a home running, whether you own it or rent it, involves several monthly costs. Some are fixed and must be paid every month. Others are fixed but paid annually. And then there are expenses that vary depending on usage and circumstances.
Fixed expenses
- Mortgage or rent: This is usually the largest monthly expense. Whether you’re paying a bank or a landlord, housing typically takes up a significant portion of your income.
- Property Tax (IPTU): Paid once a year or in instalments, this applies only to homeowners. The amount depends on the Taxable Asset Value (VPT) of the property and the rate set by the local municipality.
Condominium fees: These apply to owners, not tenants (unless the contract states otherwise), and only if you live in an apartment building or gated community.
The amount varies depending on the building and covers the maintenance of shared areas.
Mandatory insurance: If you have a mortgage, life insurance and multi-risk home insurance are usually required.
Payments can be made monthly, quarterly, semi-annually or annually.
Variable expenses
Energy, water and telecommunications: These bills vary according to consumption.
Telecommunications packages are often relatively stable, but extra usage can increase the cost.
Minor repairs and exterior maintenance: From repainting a wall to fixing a clogged drain or replacing a broken appliance, small issues inevitably come up.
If you have outdoor areas such as gardens, you’ll also need to budget for lawn care, pool cleaning and general upkeep.
Maintenance and renovation work: These expenses are less frequent but often more costly.
At some point, you’ll need to invest in repairs or improvements, so it’s sensible to keep some money set aside for this purpose.
Tips for saving money on essential expenses
Now that you know what expenses you'll have to account for, let's give you some tips on how to save money wherever possible.
Save on energy (electricity and gas)
- Review your contracted electricity power and reduce it if possible.
- Compare rates from different providers.
- Avoid leaving appliances on standby.
- Lower the temperature of the water heater.
- Use ECO programmes on washing machines and only run them with full loads.
- Choose LED lighting and make the most of natural light.
- Invest in energy-efficient appliances.
Save on water consumption
- Reduce your shower time.
- Install flow restrictors on showers and taps.
- Repair leaks as soon as they appear.
- Water plants early in the morning or at night to reduce evaporation.
- Keep an eye on your meter to spot any unusual consumption.
Save on telecommunications
- Compare prices regularly.
- Negotiate before your contract’s loyalty period ends.
- Combine services into a single package if it makes financial sense.
- Consider a plan with lower internet speeds if you don’t need high performance.
- Use Wi-Fi at home to reduce mobile data usage.
- Review your minutes and data allowances.
- Take advantage of promotional offers for new customers.
Other key recommendations
Alongside cutting costs, good organisation makes a real difference, especially if you’re new to living alone:
- Keep all invoices and receipts for maintenance and repairs, as they may be useful for tax purposes.
- Note the payment dates for bills not paid by direct debit to avoid fines or penalties.
- Learn basic home maintenance skills to avoid unnecessary service costs.
- Regularly check the validity of insurance policies and important documents.
- Don’t ignore signs of damp, leaks or structural issues.
- Double-check your electricity and water meter readings.
- Review the amounts charged through direct debit to ensure they’re correct.
Create an emergency fund
Finally, and most importantly, build an emergency fund for unforeseen expenses, such as major renovations, building works, broken appliances or damaged equipment.
Set aside a small amount each month for this reserve. Even modest contributions add up over time. After a few months or years, you’ll have a financial cushion that can make all the difference when something unexpected happens.
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