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Finance tips for flatting

Having a plan in place before you start flatting can make it a much more enjoyable experience. Here are some tips on what you should know before moving in.

5 minute read

For many of us, leaving home and going flatting is our first taste of real independence. But as great as that is, it’s also the first time we get to find out just how expensive the cost of living can be, especially when sharing a house with multiple people. Things like rent, power, food, and transport can make a serious dent in your bank account in no time at all.

Make a plan

The better prepared you are, the easier it’ll be to stay on top of things financially. So it’s worth taking a moment to sit down and write out a list of all the typical costs you’re likely to face when you go flatting.

Obviously some of these costs will vary depending on whether you’re moving into an existing flat share or if you’re setting up a brand-new flat with a bunch of friends.

Moving into a house with existing flatmates will help ease the initial shock as much of the legwork is already sorted and you can just slot in and learn how it’s done. But if it’s a new flat and everyone involved is new to flatting, the to-do list, including things like flat bond contracts, insurance, and flatting agreements, can be daunting. On the whole, there are three parts to all this – sorting out the flat, sorting out the ongoing costs, and then sorting out systems to ensure everyone pays their share. Let’s start with the flat.

Signing up for a flat

When you sign up for a flat, there are a few upfront costs that you will need to take into account. Along with the weekly rental amount, there’s also the bond payment and rent in advance. The exact amount varies, but it usually works in multiples of the weekly rent amount. Don’t forget, you’ll also want reliable reference letters for every tenant applying. This will help your chances of securing the property.

Bond

The bond is usually two or four weeks’ worth of rent. This money gets lodged with a government agency and will be refunded to you when you move out - except in certain situations, like if you’ve damaged the flat. In this case, the landlord can take some or all of the bond to fund repairs.

Rent in advance

A landlord can ask for one or two weeks’ rent in advance. This depends on whether the tenant will pay weekly (one-week in advance) or fortnightly (two-weeks in advance). So you’ll most likely need to front up for the first week or two before you can move in.

Ongoing living costs

Once you’ve sorted a place to live, the next step is getting the power on, followed by furnishing the place, putting food in the pantry, paying insurance, and hooking up the internet.

The best way of approaching this is to ensure everyone’s names are attached to all the bills. This shared approach means everyone is legally responsible and so more likely to pull their weight financially if they know their own credit rating is on the line.

Keeping track of all the money

Keeping track of who’s paid what can get messy. Many flatters and house sharers run a single bank account that everyone puts enough money into each week to cover rent and bills. It’s a good idea to make this a joint account owned by at least two of the flatmates so that one person doesn’t have sole charge of the money.

Often things work best if one person is nominated as the person in charge of getting bills paid on time, and all the flatmates are contributing their share each week. This is where your bank can help. Online banking and mobile apps make it simple to see at a glance, from anywhere, who has paid their share and how much money is in the joint account ready to cover the bills. 

Setting up a ‘flat account’ makes it easy for everyone in the flat to access, which also provides a transparent and indisputable record of who has paid what, and when. Drag-and-drop banking like BNZ’s YouMoney lets you create up to 25 accounts – you could have one for power, one for food, one for internet and so on. You can even personalise your various accounts and payees with images and photos to make it even easier to see where the money is moving.

Don't be afraid to ask your bank for help getting things set up. They should be able to walk you through getting your flat up and running in no time.

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