Are You Paying Too Much For Rent? Here’s How To Find Out

Considering the factors in the current housing market, there is a good chance you are paying more than 30% of your income on rent. Plus, given current nationwide expenses, even if you are one of the people fortunate enough to actually pay only 30% of your income on rent, that amount is still proving to be unsustainable for many Americans. For instance, if you use specific financial techniques like, say, the 50/30/20 budget rule, then your rent would fall under the 50% of your budget that is devoted to your needs. If you maintain your rent at 30% of your total income, this leaves only 20% dedicated to everything else in your needs category which can include everything from healthcare to utilities to childcare.


Not only is keeping your rent at only 30% of your income becoming increasingly difficult, but maintaining the rest of your needs-based expenses at 20% is simply not possible for most people. This is especially true considering the astronomical cost of things like childcare (where, on average, families spend 27% of their income on childcare expenses) and the ever-increasing cost of healthcare (as of 2020, a person with workplace medical coverage faced a potential out-of-pocket medical total equal to 11.6% of their income, with 2021 per person health spending reaching $12,914). Plus, residential utility bills were up an average of 5% across the country in 2022 with electricity, in particular, experiencing a 13% increase in price from 2021 to 2022.