Graduating college brings many challenges, one of the biggest is determining where you plan to live afterwards. Due to rising costs of living, and record levels of student debt, many new grads find that this decision is getting harder to make.

To help, here are some things to consider when deciding whether you should Rent, Buy or Live at Home.

Live at Home

If you’re a recent graduate and decide to move back in with your parents, you’re not alone. In recent years as many as 30 plus percent of millennials have decided to move in with their parents. It’s not just those who are unemployed, even recent grads who are fully employed are seeing the benefits of living at home.

• Higher costs to rent or buy a home
• Higher costs of living
• Rising student loan debt

For many living at home is a viable option. The challenge is striking a balance between saving money by living at home and building a foundation for the future.

If living at home still gives you access to work opportunities and the ability to network, socialize and have an active life, go for it.

If living at home isolates you, or makes it harder for you to earn money in the future, it might make sense to consider other options.

Rent

For recent graduates, this is the most likely path. Moving out and finding your own place, or sharing with roommates. The challenge is that as more people (young and old) flock to larger cities, rental apartments are harder to come by, which in turn drives up rental costs. In addition, the higher the rents in an area, the more things cost.

Often, the solution is to share apartments with roommates. Keep in mind that if the lease or the utilities are in your name, you are responsible for the rent every month. Even if your roommate is the one who is unable to pay, the failure to pay will still be reflected on your credit score.

Buy

For millennials, home ownership rates are at record lows. The good news is that interest rates are also still low, but are slated to rise over the next few years.

Before you buy a home ask yourself the following

• Am I gainfully employed?
• Am I confident in my future employment?
• Am I effectively paying down my existing debts every month?
• Do I plan to stay where I am for three to five years or longer? Can I afford moving costs?
• Do I have six months of savings in the bank and money for a down payment?
• If the answer to all of these questions is yes, then buying may be a smart move.

If the answer to any of these questions is no, you may want to consider waiting a little longer and taking steps to earn more, spend less, save more and pay down your debts.

Get an Expert Opinion

Another way to start your future off right is to talk with a Certified Credit Counselor. They can help you to organize your finances and make smarter choices when it comes to paying your debts in the future.

Want to learn more? Schedule a free counseling session today or call us at 800-920-2262.