The high cost of independent living

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MJ Aguilar, a 25-year-old wealth coach, splits his Mandaluyong dorm room with two other roommates. Photo by GELOY CONCEPCION

Manila (CNN Philippines Life) — To the comfortable, unperturbed millennial, the idea of moving out might sound absurd.

Pew Research from 2016 shows about 15 percent of 25- to 35-year-old millennials still live under their parents' roof, and for extended periods of time. Only eight percent of early baby boomers, in their heyday in 1981, did the same — but it isn't just the generation gap that’s causing the shift. Results of the United States-based study are affected by the country's housing problems, recession, and steep standard of living.

An early departure from the nest is almost as difficult to imagine in tightly-knit Filipino families, where it is an unspoken norm to stay with their parents until you are married. Sometimes, marriage doesn’t deter moving out, because of expectations to care for elders.

Yet leaving home to seek your own fortune has been a common trope for heroes' tales since time immemorial. Unless you have a family business to inherit or run, flying solo is an inevitable reality for most.

Some cut right to the chase — due to economic necessity, work set-ups, or just because they want to — and venture into the world of rent, inflation, and taxes.

If you're thinking of going financially independent, here is a guide for what to consider and save up for, as told by some brave millennials who took the leap.

Lyka Aguilar, 21, splits the rent with three friends from college, on top of sending money home to her family in Cagayan de Oro. Photo by GELOY CONCEPCION

Lyka Aguilar, 21, program coordinator

Lyka Aguilar became financially independent in February 2016, when she got a full-time job at a non-profit organization. She juggled this with a digital media consultation gig.

Rent and electricity take up a large chunk of the bill, which Aguilar splits with three other roommates. They end up paying just short of ₱5,000 a month for their flat in Ortigas. Her next largest expense is her phone bill, as she is also paying off a phone she gifted her mother.

While making the move, Aguilar recalls junking two boxes of clothes and a lot of makeup.

“When you have a lot of stuff, it makes you think you're capable of having a lot of stuff ... But when you keep it to a minimum, [it] lets [you] just stick to what we need talaga. I try to translate that into my spending. Only get what you need,” she says.

Since her father died, Aguilar has stepped up in helping out with the family expenses. She sent her brother a regular allowance as he reviewed for board exams in Cebu City. After he passed, she just sets aside some extra money for her mom, who runs a water station in Cagayan de Oro.

“I feel like it's a different story when you give [money] to your family,” Aguilar shares. “Nag-a-adjust talaga ako. If I do go out, maybe twice, thrice a month na lang compared to before.”

Lyka Aguilar says the transfer to their Ortigas flat forced her to sit down and look up minimalism. She ended up dwindling boxes of make-up to just two drawers during the move. Photo by GELOY CONCEPCION

Saving tips: Since dropping her sideline in June, saving has been difficult, but Aguilar is still open to side projects and is working toward saving enough for insurance.

It's an often repeated tip, but “Knowing your ‘why’... will help you save,” says Aguilar. “It reminds you of what's important.”

Tips for financial independents: One of the things Aguilar says she took for granted was not saving as early as college.

She also advises home-cooked food and vegetables. She's done with her days of fast food, which may have been cheap but came at a cost: “It's good to be frugal, but don't sacrifice your health.”

Eddan Macabulos, 27, rents a room in Makati with his roommate Carlo Sanchez (not pictured). The two young lawyers already planned to go financially independent as early as the tail end of law school. Photo by GELOY CONCEPCION

Eddan Macabulos, 27 and Carlo Sanchez, 26, lawyers

Fresh after bar results in 2016, these two young lawyers and friends became roommates. The decision was in part due to proximity to newfound jobs, but also because they wanted to stand on their own feet.

“I really wanted not just financial, but holistic independence and I don’t really see that happening if I’m still asking for financial support from my parents,” Eddan Macabulos shares.

“I was set on starting my career by pulling myself up from my bootstraps — my parents did it during their day, and I wanted to experience the same,” Carlo Sanchez adds.

Both roommates saved up prior to moving out to have a “buffer” fund for the initial months. Major expenses are rent, followed by electricity; Internet connection falls at less than ₱1500, while water is only ₱30 to ₱50 a month.

On the perks of being independent, Macabulos says: “Decisions, decisions, decisions” — particularly in eating out, purchases, and travel getaways.

Sanchez sums it up: “I get to spend on stupid stuff without guilt.”

Saving tips: Sanchez keeps separate accounts for savings, investments, and unforeseen circumstances.

“My bank account is automatically debited an amount every month for investments,” he says. “I also have an emergency fund, too, so I won't mix my savings and investments with that.”

Tips for budding financial independents: Both roommates advise saving in advance. Macabulos also advises splitting costs as much as possible.

Quoting a piece of advice he got, Macabulos says, “Don’t be too stressed about saving money from your income/salary during your first year of work.”

“And learn to cook,” Sanchez adds.

Tara Lim, 30, audio engineer

Tara Lim has been living on her own for six years. She has a cat named Annie, and a temporary roommate with whom she splits the ₱13,000 rent.

“Ang sakit niyang bayaran every month,” Lim says.

Expenses for furniture and appliances follow. She says, “This is the first time I’ve ever bought my own refrigerator, my own bed, shelves, dresser. It adds up.”

Uber and fast food add up too, so she has since resolved to walk and do her own groceries. Kitchenware also costs, but that can be accumulated a bit at a time.

But Lim likes it this way, she says. A few years ago, she tried going home to Subic for two weeks — and ended up returning to the independent life.

“I'm a very private person ... It's different having your own space,” says Lim. "You control your own time.”

Saving tips: “Don't live beyond your means,” advises Lim, who said online shopping was both “a blessing and a curse.”

She used to watch a lot of concerts, but later started being more selective.

“I can let some of this go ... It didn't hurt after a bit,” she says. I like saving money. I like feeling na if something happens, I can pay for it.”

Tips for budding financial independents: Lim emphasizes little acts of discipline, like scheduling bill payments, picking up your laundry on time, and sticking to a budget.

“Sticking to a budget is kind of hard if you're not used to it,” says Lim. “If you're spending other people's money, you don't think of it that much.”

Call center program manager Bernadette Sese, 28, lives with her girlfriend and her dog in a bright Eastwood flat. When picking where to live, she says, the place always has to have a view. Photo by GELOY CONCEPCION

Bernadette Sese, 28, BPO program manager

Bernadette “B” Sese regularly sets aside her coffee budget (just above ₱1,000) at the beginning of the month. She lives with her girlfriend and her dog Wayne in Eastwood, where rent hits a whopping ₱30,000. Electricity, and expenses for her pup’s food and vaccines follow.

“We had fixed expenses. So ‘yung mga miscellaneous, doon kami nagpe-play around,” Sese explains.

The call center program manager has been flying solo since 2010, but already partially supported herself in college through tutoring. Right after graduation, she moved out.

Long before moving to her new flat and current job, Sese experienced sleeping and eating in the office and being powered on energy drinks just to stick to a budget while sending money home.

On taking loans, Sese advises: “Don't.” Now that her sisters have graduated, she cut back on sending money home to pay for some loans she took to put them through college. Nowadays, she helps in providing her family transportation when she can.

“The biggest problem I had in the past [was] I didn't know how to say no,” she shares. “I think it was last year [in] December when I said, ‘No ... It's time for me to pay the past. If you could help, great. If you can't, then just let me be for now.’”

Saving tips: Keep part of your savings out of reach. Sese has an insurance plan, which also plays on stocks, where she can't touch her money.

“When you've got access to your money, you feel it's always accessible,” she says. “I even tried passbook, checking, pero wala talaga eh. Gagawa at gagawa ka ng paraan ‘pag may naisip kang gastusin.”

Tips for budding financial independents: “Brace yourselves for expenses you never thought exist,” says Sese. She says “the little things,” like cleaning materials and condiments, eventually add up.

“Appreciate your mom while you live with [her],” she adds.

Wealth coach MJ Aguilar, 25, lost his dad to cancer, family tragedy that forced him to step up as the family breadwinner. He quit college and juggled jobs in sales and date coaching before landing a job in financial advising. Photo by GELOY CONCEPCION

MJ Aguilar, 25, wealth coach

“I grew up living comfortably... spoiled in a way,” MJ Aguilar says as he introduced himself. “But [when] my father had cancer, ako ‘yung eldest, so I had to step up.”

His father's treatment took up a lot of the family funds, and when he passed away, both his younger siblings had to stop school for a while. Aguilar himself stopped college on his third year to work as a management trainee in an insurance company — a short-lived stint before he went into real estate, and later, into an unlikely job: date coaching, where he studied social cues and taught them to clients.

Date coaching was a full-time job until a businessman Aguilar collaborated with took him under his wing and introduced him to wealth coaching. He helps millennials get on their feet financially at I Am + Limitless Coaches. He never got to finish school, but he learns and teaches every day.

Aguilar shares a room in Mandaluyong with two other friends, each paying P2,800 all-in. It's his lowest expense, as he helps his Cavite household through paying bills, rent, his siblings' allowance as they finish college. He still goes home every weekend, particularly for home cooking.

“Siguro if hindi ‘yun nangyari sa akin, baka spoiled ako ngayon, umaasa pa rin kay daddy, happy-go-lucky,” Aguilar says. “Now I'm always looking for [the] greater good. Parang muscle siya eh, ‘yung pag-iisip ko sa family ko, na makatulong ako sa kanila.”

He added his newly developed sense of generosity even extends to friends and clients.

“I feel the more I go out, the more I let myself be of service to people — they're just willing to avail my services, [because] I'm adding so much value to their lives,” he says.

For Aguilar, personal growth is the biggest reason why young people should become independent early. Photo by GELOY CONCEPCION

Saving tips: Treat your savings as an expense. Aguilar sets aside at least ten percent of his earnings for insurance, which, once deposited, can't be touched.

“Kung itatabi ko lang kung ano ang matitira sa akin, hindi ako makakapag-ipon. I think of my savings as paying bills,” he said.

Any leftover money after paying for other expenses goes to the bank, in a withdrawable account for emergencies.

Tips for budding financial independents: Personal growth is the biggest reason why Aguilar advises young people to become independent early.

He also encourages millennials to get creative with side hustles, and utilize social media to grow their network. He said he discovered his clients as a dating coach because they approached him online.

“Kailangan mo talaga lumabas sa comfort zone. Unang una, kailangan mo mag-build ng connections kasi diyan ka kukuha ng clients, ng referrals,” says Aguilar.

He adds that more than learning to manage stocks or juggle accounts, it's about the mindset: “Financial freedom is 90 percent psychology, 10 percent technical skills.”