Here’s What You Should Be Spending on Rent If You Earn $35, $50 or $60k Per Year

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Deciding how much to spend on rent can be challenging. You need to factor in monthly payments like utilities, any debt payments, subscriptions and various recurring payments. Plus, you’ll want to set some income aside for savings (if possible).  If you expect to make the same income for the foreseeable future, it makes it easier to calculate how much you can afford. Here’s how to determine a method to see how much you should spend on rent based on your income.

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If You Earn $35,000 a Year…

There’s no hard fast rule that will give you an exact figure you should pay in rent. The amount that’s reasonable to spend on rent is determined by the city you live in, your income and your comfort level. So, while there’s a popular rule of thumb that you should only spend 30 percent of your income on rent, that might not be reasonable for where you’re located. When you calculate 30 percent of 35,000 per year and divide it by month, you end up with $875 before taxes. If you can find housing for $875 or less in your area, then that’s great! However, if you live in a more expensive city, you might want to base your rent allowance on the 50/30/20 rule. This rule dictates that 50 percent of your income would be spent on essentials like rent and utilities, 30 percent would be for extra spending money, and 20 percent would be for savings and paying off debt. On 35,000 a year, spending half of your income on rent would be $1,458, so using the 50/30/20 rule, that amount is the absolute most you’d want to spend on rent, provided utilities are included.

If You Earn $50,000 a Year…

Now that we have a few rules of thumb in place, you can simply apply them to any figure. So, 30 percent of $50,000 a year is 15,000. Divided per month, that’s $1,250 before taxes. Spending this or less on rent would allow you to have two thirds of your income left over to pay for essentials as well as discretionary spending. When you use the 50/30/20 rule, $2,083 a month would be 50 percent of your income. This means you want to make sure all of your essentials are covered in that amount, including rent. If it’s becoming hard to stay within this spending range, consider looking for a roommate or two. This way, not only will your rent be more manageable, but your utilities will be split as well. You can often save even more rent by taking the smallest room in the home or apartment so that you pay less than your roommates. 

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If You Earn $60,000 a Year…

An extra $10,000 makes a big difference. On a salary of $60,000 a year, 30 percent of your income works out to $1,500 per month for rent before taxes. Using the 50/30/20 rule, half of $60,000 per year works out to $2,500 per month to cover all of your essentials. Another way to lower costs is to look into lowering what you pay for your renters and car insurance. You can use sites like or to check if you’re paying the lowest rate possible. Often, the agents working at these sites will help you get out of your current insurance plan and get a cheaper one. 

Truly the best way to determine how much to pay for rent is to take an honest look at your budget and figure out how much you would feel comfortable paying. Free budgeting tools offered through Mint and Personal Capital can help you track your expenses and see how much you’re spending every month, and what you could potentially cut so you can see clearly how much your lifestyle costs. From there, you can decide how much could be feasibly spent on rent. If possible, try to leave at least a little cushion (even $20 a month) so you can put some cash into savings so that if circumstances were to suddenly change with your job or you had an emergency, you’d at least have some funds to fall back on. 

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