How Much Rent Can I Afford?
The 30% rule and 50/30/20 budget are two guidelines that can help you determine how much rent you can afford. Other factors, like your location, commute and other bills are important to consider, too.
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Senior Writer Before you start searching online for rental options, determine how much you can truly afford to pay. There are a few ways to determine what rent prices work with your budget.
The 30% rule
One popular guideline is the 30% rent rule, which says to spend about 30% of your gross income on rent. Gross income is the amount of money you earn before taxes and other things, like insurance premiums or retirement savings, are withheld.
Here's an example: Say you earn $4,000 per month before taxes. Using the 30% rule, you should try to spend $1,200 or less per month on rent. That’s slightly lower than the national median rent of $1,402, according to August 2025 data from Apartment List, a rental search service
This is a solid guideline and starting point, but it’s not one-size-fits-all advice.
The 30% rule can be hard to follow in a place like New York City or San Francisco, where median rents are well over $3,500 for a one-bedroom apartment, according to 2025 Zillow rental market summaries.
50/30/20 approach to budgeting for rent
The 50/30/20 budget can help you figure out how much you can afford to spend on rent. This method allocates your take-home pay (after taxes) to 50% for needs, 30% for wants and 20% for savings and additional debt payments.
Here's an example: If you earn $4,000 per month after taxes, you’d divide your paycheck like this:
- $2,000 for needs, such as rent, utilities, groceries, insurance and minimum debt payments.
- $1,200 for wants, such as shopping, dining out and entertainment.
- $800 for savings, such as building up your emergency fund or saving for a child's education, and additional debt payments.
What other costs should I consider?
Where you live affects things as varied as your commute and your workout routine. Consider all the costs (or savings) you might incur depending on your rental choice.
Living farther from the city center, for example, is often less expensive. But you could spend hundreds each month on public transportation costs or parking passes that allow you to commute to and from work and social activities.
Utility costs are also important to consider. Some rentals include utilities such as gas and water, have an on-site gym or a washer and dryer in-unit, which might make your rent payments higher, but save money on membership fees and laundromats.
» CALCULATE: Should you rent or buy?
What if my rent exceeds these guidelines?
Budgets exist as flexible blueprints rather than hard rules, so the reality may be that your rent, when combined with your other needs, will add up to more than 50% of your income or more than 30% of your gross income.
The 60/30/10 budget, which allocates 60% of your after-tax income to needs, may be a better fit if those other targets don’t feel like enough.
However, there are some situations where it might make sense to exceed your rent budget:
- You’re in an unstable living situation. It may sometimes be necessary to spend more on rent (if you have the means) if your current living situation is unsafe or otherwise unstable.
- You have to move for work. You may need to spend more on rent if you have to relocate to be closer to work, or if you’re moving somewhere for a change of pace that will help improve your quality of life.
How to cut costs to make rent more affordable
If what you can afford doesn’t align with the rental market in your area, look for ways to cut costs elsewhere.
Start by looking at non-essential spending to free up space in your budget, but you can often find savings among necessary expenses, too.
- Negotiate your bills: Heat, water and electricity are necessities, but streaming services, for example, fall squarely in the “wants” category. Try negotiating with your service providers to get a better deal on your internet, cable and cell phone plans. (This script may help you cut your cell phone bill.)
- Spend less on groceries: Get in the habit of using coupons and planning your meals to maximize your grocery budget. A grocery list app can keep you on track in the store, and switching to store brands or shopping at discounted grocers, like Aldi or Grocery Outlet, can help widen your monthly margin.
- Split costs with a roommate: Living solo means shouldering the burden of rent and utilities on your own. Instead, find a roommate and split the cost of renting a two-bedroom or even a house. Need a more affordable option? Consider renting a room in a house.
- Take advantage of move-in deals: Sometimes landlords or rental agencies offer special promotions to entice new potential tenants. You may be able to get a discount on the first month’s rent or bypass some of the deposit requirements. You may also be able to negotiate a better rent price if you offer to sign a longer lease — just read the fine print about what it costs to break your lease, just in case you need that option down the road..
- Shop around for car Insurance: Look for ways to save on car insurance, including getting a car that’s cheap to insure. If you’re a good driver, many carriers offer safe driver discounts to help you save even more.
In critical times, tactics such as dipping into an emergency fund or applying for rental assistance programs may be necessary to help you pay rent when you can’t afford it.
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- 1. Apartment List. Apartment List National Rent Report. Accessed Aug 19, 2025.
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