Is it possible to afford a $2000 apartment on $80k salary?

Business Forum Personal Finance
1

(Written on mobile)

Background: I’m 23, earning around $80k yearly before taxes, plus a 25% year-end bonus from my employer that goes straight into my RRSP.

My current housing situation wraps up by year-end, so I’ll need a new place. This $2000 spot is the lowest-priced solo living option I can find nearby.

I don’t have any debt right now, but I’m planning on getting a car soon.

(1) Based on meeting targets, I typically get 15-20% of the bonus, with 25% possible.

(2) I know roommates are an option, but I prefer living solo due to the uncertainty roommates bring.

(3) Planning on financing the car but aware of the pros and cons of paying upfront.

Edit: The bonus is extra on top of my salary—so it could be an additional $20k that I could keep as taxable income if I don’t put it into the RRSP.

2

I earn the same as you.

$2000 a month is about the max I’d be comfortable paying for rent, and I don’t even own a car.

Add in car payments, insurance, and gas, and it might be tough—depends on how much you spend outside of rent.

3

@Haven
Agree with this. I also made around $80k when I was 23 and would only go as high as $2000 for rent. Car payments could be rough unless it’s paid off, insurance is low, and maintenance is minimal.

Also, it’s easier without a partner. Just my two cents! :smiling_face_with_tear:

4

@Haven
With your bonus and after-tax income, you might be okay. Just budget for everything, including utilities, groceries, and car costs.

5

A few years back, I made $72K and paid around $1850 in rent. It was manageable, but didn’t leave a lot for other goals.

6

Around 1/3 of your income will go to rent if you get that bonus. It’s doable—just plan your spending. Beats dealing with roommates.

7

I make around $83k, bringing in $2180 bi-weekly. After taxes, pension, and other costs, my rent is $2124 with parking included, which I manage fine.

I also set aside $300 bi-weekly for TFSA since I’ve already saved for emergencies. Life’s good, but I do keep things simple.

8

@Zen
So $83k gross but $2180 bi-weekly? Wouldn’t that be about $56k?

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Rio said:
@Zen
So $83k gross but $2180 bi-weekly? Wouldn’t that be about $56k?

Yeah, my bad! It’s gross $83k—take-home is around $56k :sweat_smile:

10

Zen said:

Rio said:
@Zen
So $83k gross but $2180 bi-weekly? Wouldn’t that be about $56k?

Yeah, my bad! It’s gross $83k—take-home is around $56k :sweat_smile:

Gotcha!

11

@Zen
I take home about $2300 bi-weekly, and I don’t make $83k. :man_shrugging:

12

Sai said:
@Zen
I take home about $2300 bi-weekly, and I don’t make $83k. :man_shrugging:

What’s your RRSP or pension deduction? Mine’s 9%, so my taxes adjust a bit. Right now, I’m getting $2300 since CPP and EI are maxed, but that’ll change next year.

13

@Zen
Not sure, but $800 is taken off, leaving me with $2300.

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Sai said:
@Zen
Not sure, but $800 is taken off, leaving me with $2300.

That does work out to $83k per year.

15

Is your net pay around $5k monthly?

Spending 40% on rent is a lot. But if you have a few months of rent in savings, it’s safer.

16

Terry said:
Is your net pay around $5k monthly?

Spending 40% on rent is a lot. But if you have a few months of rent in savings, it’s safer.

These days, it’s pretty normal to spend 40-50% on housing. Sad but true.

17

Terry said:
Is your net pay around $5k monthly?

Spending 40% on rent is a lot. But if you have a few months of rent in savings, it’s safer.

What can he really rent for less than $2000? Shouldn’t have to live uncomfortably with that income. Sometimes 30% on rent just isn’t possible.

18

@Quinlan
There’s always tents for sale!

19

@Quinlan
There’s a difference between ‘living rough’ and ‘getting a roommate’. Living alone on $80k is doable, but it means giving up other ‘nice-to-haves’.

20

Tan said:
@Quinlan
There’s a difference between ‘living rough’ and ‘getting a roommate’. Living alone on $80k is doable, but it means giving up other ‘nice-to-haves’.

Yeah, but sharing a place with roommates can be a hassle for adults.