This classification is based on assumptions about your monthly expenses that might or might not be close to your particular situation. If regular expenses are not specified, we define low risk lease amounts as 15%, medium risk as 25% and high risk as 35% of the remaining income which consists of net income minus recurring debt. The risk levels used in this rent calculator are defined as follows. This rent affordability calculator can be a useful assistant in this task of financial risk management. Estimating the rent you can afford requires that you engage in cash flow management. Therefore, it is always wise to have spare money at the end of the month which you will put aside in good months, and in months with extra expenses you can use this "cushion" to remain cash-positive. However, life is naturally uncertain: your income might change in a negative fashion, you might incur larger expenses in some months, due to unexpected medical bills, fines, unplanned vacation that you really, really want to go on, and so on. For example, if your monthly income is $5,000 and you are paying a student loan of $1,000 per month, and have expenses for utilities, food, transportation, and leisure of about $2,500, then the remaining sum $1,500, which is what you would be able to pay for rent, if all other factors remain constant.
Rent affordability is the monthly sum you can dedicate to rent payments and still be financially in the positive at the end of the year, if not at the end of each month.
0 kommentar(er)
