I will be graduating from college in a month should I stay with my parents or rent an apartment?

Good for you for thinking about and planning your financial future...

First off - I think your price range on the house is a little high for the income that you are going to be making. A rule of thumb is to have a mortgage that is between 2x and 3x your annual salary and that's 110k to 165k. The 165k would be stretching your budget.

I would probably start out doing the easiest one to un-do. What I mean is, if you start doing it and don't like it, you can reverse your decision. In this case it sounds like living with your folks is the easiest to un-do. You can move out at anytime and blame the traffic and commute and a need for privacy if you want your own place after a couple of months. If you rent the apartment first and don't like it, it's a lot tougher to un-do.

Rent generally should be ~25% of your gross monthly pay (max.). For you that would equate to $1145, so an $800 per month rent payment is more than affordable.

You should do something else, too. While you are living with your parents or in your apartment, you should calculate what a mortgage payment would be. Make sure that payment is affordable and comfortable before you take it on. Assume you went with the upper end of your mortgage range on the rule of thumb. You took out a $165,000 mortgage at 6%(and you put 20% down, so your initial house price was $206,250). You principal and interest payment will be $990 a month. Add in $100 per month for insurance (could be more, could be less) and another $250 per month in real estate taxes (could be a lot less or a LOT more) and your total payment is approximately $1350 per month.

A more detailed guideline is to spend no more than 28% of your gross income on a mortgage payment and no more than 36% of your income on your total debt service. These used to be the ratios that banks would use, but in the real estate run up the rules became looser and I would suspect they are tightening back up again. The 28% of your income comes out to be $1285. As you can see, a mortgage of 3x your annual salary is quite tight. The 36% ratio for you is $1650 and every debt payment has to fit in under that, mortgage, car payment, student loans, credit card minimums, everything.

So, to sum up... Start out with your parents. If you can't stand it (for whatever reason, invasion of privacy, commute, etc.) you can live on your own. Re-calibrate your home buying wants to reflect your income. Your goal of a $200,000 house is borderline (only do-able with 20+% down) and $250,000 is too much. Pretend you are paying a $1350 mortgage while living with your parents (it will let you see what it's like and you'll save a bunch of cash while you do it).

Finally, don't forget to start a Roth IRA in your first year of working and contribute to your 401(k) to AT LEAST get the matching funds from your employer.

You sound like you've got a good head on your shoulders and you should do very well for yourself!

good luck!

Ha, you lucky bastard! Your parents will actually let you still live at home if you want to. I would say that's the way to go, cos you'd save heaps of money from not having to pay rent and all that.

I hear what you say about traffic, I guess there'd be petrol costs, but I think overall staying at home means you save more. My parents want me to the move out as soon I get my first job after I graduate end of this year.

Good luck anyhow. :)

Your long term goal is to own the house. Live with your parents to save the down payment. In 2 to 3 years, the housing market will bottom out. In that same period, you'll of accumulated the wealth for a good down payment.

This is a good, sound, strategic financial move. The market is working in your favor right now.

If you're NOT living in a dorm, which I'd recommend for a freshman, any freshman, I'd say stay at home. You'd be surprised about all the extra expenses from having an apartment. Glad to hear you've got your tuition paid and won't be going into debt for college! I'd say make a plan to move into an apartment your sophomore year after you've spent a year at the school and know about different living facilities. Save up for apartment and utility deposits. Consider summer school as a way to get through college in 4 years.

I think you should stay with your parents. You'll have to spend more time in traffic driving to and from work, but it will be a lot easier for you to save up for a house if you're not paying $800 a month (which is around $10,000 over the course of a year) for rent, plus utilities.

If you have $10,000 now, then you should have no problem buying a house in a year or two (depending on how well you save your money). I am in the process of buying a $275,000 house. I had $25,000 of my own money to put down, and my parents gave me $10,000. So I have a total of $35,000 for a down payment. I've been approved for my loan and everything. If you save up a large amount of your paychecks, you should be able to buy fairly soon.

Another thing to think about is the moving process. Moving sucks. If you move into an apartment now, then into a house in a year or two, you'll have to move twice. (Renting a U-Haul, packing everything up, unpacking everything, settling in, paying additional fees for having cable/Internet/phone service set up, etc. all takes its toll.) If you can hold out for a couple years until you get a house, you can avoid moving twice.

Wow! If I were in your position, I think I would like to save up also. Maybe you should wait until you after you graduate from college and worked at your work place for a while before you decide to move out. You might want to move into an apartment that you can share with a roommate or something. I have found that a roommate is not such a bad idea. whichever you choose, I wish you the best of luck! :)

If mass transit is available, or even fast public transit, I would say stay with your parents.

If you had to drive a substantial part of the distance but avoid a lot of the time by parking and taking the train.

But spending that much time on the road.. you would be better to work overtime a couple hours a day and pay for the local apartment.

Here is what I suggest . Stay with your fork's.Pay them some rent and save the rest. Your parents are their for you and if you can stand the long trip to and from work ( witch also lets you unwind before getting home ) their place is still home. If you give them some rent you will be spend ding on yourself to teach you to spend that on lone repayments and your parents will have that extra to spend on making the last sty with them better.