Moving is both exciting and stressful at the same time. Most of the people move to the other city or a location when they find a new job or simply want to make a change. However, you get an opportunity of moving to a new city out of nowhere. It is likely that you want to grab new opportunities over there, but you do not have enough finances.
When you move to a new city, you need to find out the cost of living. It can be either high or low. However, cities with plenty of earning opportunities have higher cost of living. You are likely to earn a good amount of money and hence you will manage to meet all of your regular expenses, but there are a lot of reasons you need to be careful with your finances.
Budgeting is crucial
If you are planning to go to a new city, you should start setting aside money as immediately as possible. Try to make two separate budgets: one for your moving expenses and one for your regular expenses.
Your moving budget should include all expenses of getting you and your belongings. Find out an affordable transport mean and if the new location is further afield, it can cost you a bit more. Estimate the cost of shifting and accordingly prepare a budget.
Budgeting is also essential if you want to buy a home in the other city. It is likely that you will want to get a foot on to a property ladder in the other city for any reason, for instance, job opportunities are higher over there. In this scenario, you need to have a deposit size of at least 5% of the total cost of your new house. You should know the prices of your house in the new location to start stashing money.
The budget for your regular expenses will prevent you from overspending. Be ready for upfront expenses while moving. It is likely that your budget fall short of some money, but you do not need to worry because you can apply for short term loans in Ireland.
Optimise your credit score
Whether you are renting or buying, you will need a credit score. A good credit score can help you get a mortgage at lower interest rates. Your landlord will also peruse your credit file to analyse the default risk.
Make sure that you do not miss a repayment of a debt. Keep your credit utilisation ratio very low. It cannot be more than 30%. If you are facing trouble to make payments on time, you should talk to your lender immediately to know if they can move you to a new payment plan.
Even if you are just sharing a room with your friend, you should have a good credit score because you may need to borrow money in case any emergency pops up. Getting an unsecured personal loan can be difficult with a poor credit score.
Do not forget to change your address on all your credit cards and bills. If you have been receiving bills at an address where you no longer live, it can make you more likely to fall behind repayments. This is one of the biggest reasons for having a poor credit score. A lender will cast aside your application if your contact details are not correct.
Before you apply for a mortgage or a personal loan, you should go through your credit card at least once to make sure that it does not consist of an error that you do not recognise. Sometimes erroneous details may also account for impaired credit standing.
Build an emergency cushion
Even though you are stuck to your budget, you should have an emergency cushion. In fact, it is paramount when you are moving somewhere. You should brace yourself for unexpected costs and the only way to deal with them is having an emergency cushion.
Financial experts suggest that you should have three to six months worth of living expenses. Even though you have an option of borrowing money, emergency cushion can save a lot of money in interest payments.
If you have to find a job after moving to a new city, it becomes more important to have an emergency cushion. You will need at least six months worth of living cost. However, you need to land a job as quickly as possible.
The bottom line
If you are planning to move to a new location, you should immediately start putting aside your money. Financial burden is natural, but with a keen eye on your finances and patience, you will find yourself where you want to be.