How much should your monthly rent be?
The general recommendation is to spend about 30% of your gross monthly income (before taxes) on rent.
Therefore, if you’ll be making $4,000 per month, then your rent should be $4,000 x 0.3, or about $1,200.
Another way to calculate this number is to divide your annual income by 40.
How much is too much rent?
One suggestion, provided by Metropolitan Life Insurance Company, is to spend no more than 25 percent of your monthly gross income on your rent. For example, if your annual salary is $30,000 per year, or $2,500 per month, you shouldn’t plan to spend more than $625 per month on rent.
How much should you spend on rent 2019?
Most articles and financial experts recommend the “30% rule,” spending 30% of your gross monthly income (before taxes) on your monthly rent. That means, if your income is $4,000 per month (or a $48,000 annual salary), then you should be paying $4,000 x 0.3, or about $1,200, on rent monthly.
How do you know you can afford rent?
Simply take your pre-tax annual salary and divide it by 40 to find the monthly rent that you will be approved for, assuming your landlord uses this requirement. For example, if your annual household salary is $100,000, then you could afford to spend $2,500 per month on rent ($100,000/40 = $2,500 per month).