Moving: The Latest On My Decision

I've decided to move.*

(*"decided" in the dictionary of me = decided for today. That could change tomorrow.)

I don't want to live in a super-cheap living space, per say, but there are a lot of big-ticket items I want to buy within the next few years (including cosmetic teeth work and a condo), and spending $1300 a month just means that my dream purchases will not be possible.

I looked at a place for about $960 that I like, but it's a bit out of the way and I feel like if I'm going to move, I might as well try to get something even cheaper than that. I'm not sure how cheap I can go... The $960 place at least has its own bathroom (just a shower, no bath), and anything less than that will undoubtedly be a shared bathroom situation.

There are plenty of random roomshares on Craigslist for about $500-$700, and some of them even include utilities, but the majority of them do not have kitchen "privileges." I don't really understand how using a kitchen can be a privilege, it's not like you're at college with a cafeteria to eat at. Not that I use my kitchen all that much other than to microwave something, but I still think I ought to get a place with a kitchen.

It's looking like I'll just move out at the end of June and look for a place in July. If I do manage to find a place for "cheap" I'm going to really be careful not to overspend throughout the year and instead to really focus on saving. That way I can save up to get my teeth fixed, maybe get some laser hair removal for my face, and finally one day buy a condo.

Ridiculous to Stay, A Pain in the Ass to Go

Ah, it's a beautiful Saturday morning in my lovely studio apartment. The spring air is keeping the room cool - in a few weeks it will be piping hot outside, with the heat somehow collecting in between the walls of my studio.

In the background of my waking state is TLC's "My First Home." A couple is looking for a home in the Bay Area, and they've found one they loved.

Meanwhile, I search Craigslist ads vigorously. It's not that I'll find a place to move today, as my move-in date is July 1 at earliest, but I'm still trying to decide whether to leave my complex for a more affordable option or stay here and deal with a tight budget and less savings.

When I moved in and the studio cost $905 including utilities, it wasn't that much of a jump from the $700 + utilities room share options available on the market. For $100 extra dollars, approx, I could have a place of my own. That was a no brainer.

Then rents went up to $1050 and I decided to stay. It was a shock, surely, but it still seemed like a pretty good deal given my options.

$1300 - is about double what I could be paying for a room share situation. I could even compromise and get a room and bathroom in a 2br/2ba condo apartment for less than the $1300.

Moving is such a pain in the ass, though. I could hypothetically "move" for little cost, if I can get some friends to help. As far as furniture goes, I don't have much. The only large thing I'm sold on keeping is my bed, since I bought that new for a whopping $800 two years ago (I decided after 6 months on a used futon with poor support, I deserved a good night sleep). I have a large bookshelf I got at Target a few months ago and it's really heavy - but it would be a shame to toss that! Other than the bed, bookshelf, and some small tables, I have a piece of crap IKEA coffee table that started to fall apart before I put it together (though it's functional) and a large horizontal dresser that I could part with - I'm not sure anyone would want to buy it, but I'd consider trying to sell it on Craiglist. I have plenty of room in my closet now for my clothes, and I'd hope that wherever I move would have at least this much closet space. Then there's a TV, a printer, a microwave, and other odds and ends. I really don't have that much stuff. It's still a bitch to move, but it's not like I'm moving a house worth of life. It's just whatever I could fit in a studio for the past two years.

Also, having less space might be good for me. It would keep me organized as there wouldn't be places to hide things. Heh.

The downside of getting a roommate is - well - obviously enough to have me living in a studio currently. Noise. Roommate drama. Not being able to cook naked in the kitchen. These things are hard to compromise on. :)

My biggest fear is that I won't find anything I like. I have some cushion. If I decide to move - I'd come back to California around June 20-something, and I'd have that time to finish getting out of my apartment. I'd put my things into storage and move in with my good friend who has offered up her second bedroom. I'll pay her rent, but it will be way less than what it would cost to stay in my studio in August. $1300 versus, maybe $500 or something (plus whatever it costs to put my things in storage for a month.) That will cover the 2 weeks in June that I can't work because I'm going to be in Israel on vacation. Then I can really take some time to find a good living situation.

The real question is, how picky am I? I get anxious in so many living situations. Finally, in this light and airy studio I feel, well, at the very least calm and comfortable. The greenery outside (beyond the parking area) makes me happy. It almost reminds me of home, back east. I love waking up here.

But is it the stupidest thing in the world not to move? If I did move, I'd look for a place ideally that costs less than what I'm paying now, so I could pay under $1000, and I'd put any extra money between that and the $1300 I would be paying for my studio into a special down payment fund. I'm tired of renting, and dealing with yearly rent increases.

I just wish I felt more settled. All of my friends are getting engaged and married. Buying homes. Me? Well, I've been in a relationship for two years. We joke about moving in together one day but we're talking more apartment than house. He's going to grad school in fall 2009, and who knows where I'll be. That's why it really doesn't make sense for me to buy anything right now. Even though the prices for condos in the area are coming down while rents are going up, up, up.

The more I think about it, the more I realize the only logical option is to move. I could be saving $500 a month if I find a place for $800, or $6000 a year. $6000 a year is nothing to shake a stick at. That's a huge chunk of change to go to my downpayment fund. Even if it's $4000 and I get a slightly nicer place, it's still a lot of money.

*sigh* - I just... wish there was an obvious option hitting me on the head. But life is never so black and white.

Is Moving Worth It?

As many of you know, my rent has gone up $400 in the past two years. That, alone, should be enough to get me out of this $1300 a month studio apartment.

But looking at the apartment rental listings on Craigslist, there really isn't much for anything less. And at least this is utilities included for $1300 a month.

Going from $1050 a month to $1300 a month is definitely going to mess up my budget. I finally was making enough to do some serious saving (so that one day I could buy a house, god forbid) and this price increase basically makes that impossible - unless I manage to get a job that pays even better than my current job, which is probably possible, but I love my current job, and it pays pretty well, and I'm so happy working for this company, and I don't want my rent price to control my career.

It's possible I can find a place cheaper. There are studios occasionally on the market for anywhere from $900 to $1200 in the area. By area I mean anywhere from South San Francisco to Sunnyvale. The "SF Peninsula." Silicon Valley. Where the majority of people who live here are engineers making bank, and the rest of us are, well, half-wishing we were engineers.

Getting a roommate seems like the only logical thing to do right now. I don't do well with roommates. Living alone has taken my depression and thrown it out the window. For the most part.

Lucky for me, my friend volunteered her second bedroom as a place for me to live in July. That's very nice of her. I'll pay her rent, of course, and I'll save some money because I won't be paying $1050 or $1300 - what I would be paying if I stay in my current place. I can't stay there forever, but a month will probably be ok. She has a big dog and I don't get along that well with most dogs. But maybe I'll make friends with the dog in July.

So if I decide to move out, I'll pack up most of my stuff before I leave for my trip, and then put all my furniture into storage when I get back at the end of June. In July I'd do my apartment shopping and, fingers crossed, I'd find something decent that's a good amount less than $1300 a month so the entire moving situation was worth it.

Given, I'm somewhat picky about my living space. I like light in my apartment. I work from home most of the time, so I need a place where I can be comfortable working. A place that isn't too small. I get really claustrophobic in teeny tiny studios. My current studio is nice and large. It would be nice to have a balcony or patio. It would be nice to have a second room to make my office, so I could deduct that portion of the rent on my taxes. I'd probably turn the bedroom of a 1br into an office and keep the living room set up as a "studio." I hope the IRS wouldn't mind that I store my clothes in my office closet.

How We Gonna Pay This Year's Rent? - a $250 a month increase!

I knew it was coming. But I didn't know how fast or how hard.

My rent increase letter arrived in my mailbox today. In its perfect off-white envelope adorned with the elegant and harmless-looking apartment complex logo, the contents inside were more like an offer of a boxing match where the mailer was allowed to bring guns and a knife. I would, of course, have to fight bare handed.

When I moved into my quaint Silicon Valley studio apartment two years ago, it cost me $905 a month, utilities included.

Last year, when they bumped the rent up to $1050 a month (still, with utilities included) I was tempted to leave. But around here, I had few options anywhere near as nice. I wanted to live alone - that's part of the problem. Still, other options for studio apartments that are cheaper than $1050 are, maybe, $900, and look more like a closet than an apartment.

Today's letter, I knew, held the answer to my question - will I have to move out this year or can I stay for one more year? The answer... I'm moving out.

The utilities are no longer "included" although they're offering $50 a month extra for them to be "included." That brings the total rent up to $1300 a month to get what I'm getting now for $1050. A $250 increase? Are they out of their minds???

No, they're just raking in the dough while plenty of people are losing their homes and the rental market is getting increasingly more squeezed. When my rent was $905 another company owned the apartment complex, in fact, I think it was family owned, so the rents were always reasonable. Then this big shot property management company came in, decreased the quality of life around here, and upped the rents. Gotta love capitalism and free markets, eh??

So... now I have to figure out what to do. To complicate matters, I'm leaving town for about a month at the end of May into June, which leaves me with about a week when I get back to find a new place.

The good news is that my friend has offered to let me stay with her while I look. So it sounds like I'll be storing my stuff in storage for the summer, living with my friend, and trying to find a decent rental in this painful renters market. I'm almost tempted to look into buying. It seems like a really good time to buy. I'm not sure I'm in the right part of my life right now to buy property, but gosh, if I'm going to really be spending that much of my income on housing, I might as well be putting it into something I'll own in the long run.

So right now I have about $25k for a down payment if I cash out my Roth IRA and all of my savings accounts. Of course that would leave me with no emergency fund - probably not the best idea. Perhaps I could convince my parents to give me a loan for a more enticing down payment, but I'm not sure they even have the money. Well, my dad will have the money in a couple of years when he can access his 401k, but he retired early and the money is apparently somewhat tight right now.

Do any of you think I should look into purchasing property? I'd probably want to buy a 1br condo - it seems to be in poor judgement to buy a studio (as I doubt it's easy to resell a studio.)

There's a lot I have to think about. I didn't expect such a huge rent increase. I thought maybe they'd bring it up to $1200 and I was going to deal with that. But $1300 a month? For a studio? For a fucking studio?

Seriously.

Saving for a House... or a Condo?

I've always wanted to save up enough money to buy a house outright, without dealing with paying double for the house because of mortgage rates. I don't like the idea of buying anything piece by piece and paying more for it.

How hard would it be to save up for a condo on my own? Well, pretty hard given the cost of living in the Bay Area, but is it entirely impossible?

I probably should get my rent down quite a bit if this is my goal, for wasting $1050 a month on rent that could be put towards monthly house payments seems to be just as ridiculous as paying interest on a mortgage.

This is the first time in my life (as soon as my raise kicks in) that I feel like I'm making more money than I need. I've always spent too much as it is, but yesterday when I was re-doing my budget I found that I had the luxury of liberally deciding where to place my hundreds of dollars of savings per month.

I feel guilty for making so much, but when it comes down to it $60k after freelancing and working 40 hours a week is not *that huge* of a paycheck. It's certainly more than I ever expected to make, and yet I know people my age making much more. What do they do with all that money? I guess the only thing to do... other than living frivolously... is saving for a house and retirement.

Of course, I'm making $62,400 a year between my 40-hour-a-week gig and my stable 10 hours a month marketing writing job, plus any extra freelance pay I take in over the year... but all that's without any benefits. Last gig I was making $50k plus the $400 a month for the freelance gig, but I had great health benefits at no cost to me. So in the end I think now I'm making just a little more. Plus, I've chosen a crappier health insurance so I'm not spending as much on that as I would had I chosen to stay on COBRA.

In any case, if I keep doing a good job at my current gig, and gee I hope I will, I'll only be looking at raises down the road. Who knows how much... and I'm not sure the marketing writing gig will last forever... but it seems fairly stable (I work for my uncle and write for four different newsletters he designs and sends out each month for his marketing company and the only reason I'd stop writing them is if he loses a client).

I feel overwhelmed with the money I'm making. It's not that much, yet it's way more than I know what to do with. Except I certainly could spend it all at the mall in one day, given a slip into depression and a pick-me-up shopping spree.

Instead, I really want to focus on saving. It's tough seeing my Roth IRA, stocks and mutual funds slipping, but it's nice to have some extra cash to play with. The major question is, where do I put the money? I know they say to max out your Roth first, but that seems kind of silly if you want to go to grad school or buy a house. This year, for instance, I've put $4000 in my Roth, so I have $1000 left to contribute. Next year, though, I'll have less savings up front to dump in my Roth. I've put $7000 in there total for the last two years, I think. It's down to $6800 or something right now.

Meanwhile my CDs, even those with crappy interest rates, are obviously up a few hundred dollars after being locked away for a year.

To buy a house, and to make money off my money, it seems the Roth might be the wrong place to put my money. Of course I want my savings to multiply towards my retirement, and it's nice to think of what the money would do over the years if I max out my account every year... and I don't have a 401k at work or anything, so it's up to me to save my money for retirement.

It's funny, because my boyfriend isn't thinking about any of that yet. Every time I try to tell him to start saving his money in a Roth he gets all defensive and doesn't want to talk about money matters. He thinks I'm being preachy. Meanwhile, I'm just trying to educate. Oh well, he usually isn't so stubborn about things, but when it comes to money he wants to figure it out on his own. Fair enough. I just consider him the man I will one day marry, and if I'm going to have money in retirement and he won't, that will make for one lousy retirement.

Of course, I might die well before retirement (hopefully not) or he might (no!) or maybe we won't get married at all. Life has too many uncertainties to put all my eggs into one tax-free basket. Right?

But still, the question remains... how do I save $500k for a house so I can pay off the house (or at least most of the house) up front?

I really wish I could save $500k and my boyfriend could save $500k and then we'd both buy a $1 million house. How long would it take to save $500k?

If I save $2000 a month, that's $24,000 a year.

So it will take some time. It will take 21 years.

So I could buy a house in 2029 when I'm 45. That seems in poor rational.

But... what if somehow I get a raise and I start saving $3000 a month somehow? That's only 13 years. So I could buy a house in 2021 when I'm 36.

The sad part is that house prices will likely go up by then. Now, and in the next few years during this recession, is the best time to buy. The money I'll end up paying on inflation and such might end up matching what I'd pay on a mortgage.

I don't understand how I could save for a house.