9 Categories To Include In Your Mock Budget Before Migrating to the USA

So, you are an incoming immigrant to the United States…

Do you wonder how much money do you need EVERY MONTH to live here in the United States of America? Create a budget, even a mock budget, to know for sure.

CAN YOU AFFORD AMERICA?

What are you waiting for? Tick-tock, the clock is ticking. You have an active visa application, and you are expecting to be stateside very soon: You got to know!

After reading this post, we hope to spark some ideas in you. (Scroll down below to find the link for some printables you can use.)

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THIS POST BELOW IS ABOUT HOW TO CREATE A BUDGET TO PREPARE THE NEW IMMIGRANTS FOR THE LIFE IN THE USA.

In making your estimated monthly budget you can easily get data from at least two sources:

- Reach out to family and friends, in the area and city you will be relocating to.
- Trawl the internet for answers, with the caveat that you should read sources that are backed up with data. Try government websites and reputable agency sites.

This post is a written so that you, dear new and incoming immigrants, can have a rough IDEA of how much you will need to spend monthly when you come to live here in the US.

Learn from snippets of our own experiences. Let us help create an estimated budget for you.

(See the Freebies page for printables you can use.)

Our Experience

Truth be told, we did not create a mock budget before coming over. We have not thought of it. We would have welcomed the suggestion to do it. We would have been better prepared.

CREATE A BUDGET FOR FOOD

When you create a budget, food expense is one of the top categories that must be on there.

You may be wondering what the average food expense cost for a typical immigrant family is, and you start asking around.

When you ask friends and family about their food expenses be aware that whatever amount they say is just a BALLPARK FIGURE, meaning:

- It could be their “food at home” expenses only and does not include “food away from home”, AKA takeout or dinner outside of the home.
- The person you asked is not the one in charge of shopping or budgeting and does not know the fine details of home expenses.
- They have different dietary requirements and lifestyle as you and your family do.

The US Department of Agriculture, through its agency the Food and Nutrition Service, has data on the AVERAGE monthly expenses on food of American households.

You can go to the FNS/USDA site itself, but we have found an article that explains these plans for the layman, which you can READ HERE.

The data is classified into 4 plans:

The Thrifty Plan

The Low-Cost Plan

The Moderate Cost Plan

The Liberal Plan

The Thrifty Plan

The Low-Cost Plan

The Moderate Cost Plan

The Liberal Plan

For this exercise, choose an amount that you think is your bracket. Jot those figures down on your paper or on the printables we provided for your use (FREEBIES page).

Do not worry, once you are stateside you can adjust those figures as you discover food sources and lifestyle that fit your needs.

Our Experience

Our small family, for example, was categorized midway between the Low-Cost Plan and the Moderate Cost Plan when we first arrived here.

And that was quite a risk as new immigrants: We barely started on our jobs and money was tight. But, at the same time, we wanted to taste the many varieties of new foods available.

CREATE A BUDGET FOR HOUSEHOLD ITEMS

Let us define, at least for the purpose of this exercise, what can be considered as household items. Household items include all things that are used within the home, whether they are for personal use or common use.

Such as the following:

TOILETRIES

CLEANING MATERIALS

TOOLS AND IMPLEMENTS

APPLIANCES AND FURNITURE

... and MANY MORE

TOILETRIES

CLEANING MATERIALS

TOOLS AND IMPLEMENTS

APPLIANCES AND FURNITURE

... and MANY MORE

If your experience is similar as ours was, your first time buying these items will be your first biggest purchase. Because, of course, you could not bring all these things when you migrated!

But take heart, you will soon find ways to save by choosing cheaper brands, discover more effective products and/or invent ways to be frugal with what you have. After that, you can adjust your budget from there on out.

To create a budget for this category (Household Items), you can list the things you are using right now in your home AND THEN research on the internet how much the price of a similar product in the US.

Our Experience

As new immigrants, we averaged $180-200 per month for household operations, housekeeping and laundry supplies, and personal care items collectively.

Right now, we have changed brands so many times already. As years went by, each family member discovered new brands of toiletries, and has developed preferences.

While we may have favorite brands now, we are constantly on the lookout for better products at better prices.

CREATE A BUDGET FOR HOUSE RENT

It is not easy to create a budget for the house rent category because there are so many variables.

For example, upon migrating:

- Will you be on your own right away?
- If staying with friends or family, will you be paying rent in full or in part?
- If staying with friends or family, will it be for the moment or for the long term?
- What type of dwelling do you have in mind, house, or apartment? How many rooms, bathrooms, what amenities do you want, etcetera?
- Would you and your family members be OK with meager living situations at first, like shared rooms, sofa that transforms into beds at night, shared bathrooms, and such?

You alone can answer those questions.

In fact, it is easier if you are relocating to an area where you have friends and family. They can be your source of information for rental fee figures based on what they know locally. They can also tell you the best neighborhoods to live in.

However, if you will be in a totally different place (state/city) from family or friends, there are still ways to know the rental prices.

To get an estimate of rental rates per state (and approximate area within a state) this map on RENTDATA.ORG can help you find the fair market rental rates.

Just point your cursor at a location on the map and it will give you the information. The image below shows how it looks like when you point your cursor on the map of the US State of Kentucky, using the site RENTDATA.ORG.

In addition, this same site gives you data of rental rates from zero bedroom (studio) to 4-bedroom apartments and houses for rent.

Our Experience

We were fortunate to have several families who were in the US many years ahead of us. They reside in the same state area where we will be relocating. They were our primary source of information about the local rental rates.

However, despite our advanced knowledge, still, there were so many variables that could not be predicted.

CREATE A BUDGET FOR TRANSPORTATION

Transportation, next to renting a home, is one of the top expenses of any American. Unfortunately, this is one other category that is not easy to create a budget on because, again, of many variables.

For example:

- Where will you live and where will you work? Is the home located within walking and biking distance to work?
- If home and work are far apart, is there a reliable transportation service, private or public, to bring you efficiently to work?
- Do you drive? How soon can you get a driver’s license when you migrate?
- How about school – is the house near or far from the school?
- Will someone be able to provide a car for you? (Meaning, could lend, co-sign a car loan, sell a car for cheap to you?)
- Will you be able to buy/lease a car immediately on your own when you migrate?

You alone can answer those questions.

In the meantime, you may consider any of these two options: owning a car OR using public transits.

MONTHLY EXPENSES OF OWNING A CAR

AAA (American Automobile Association) is a federation of motor clubs throughout North America, has published in that in 2016 the following are the average cost of individual driving:

CAR'S DEPRECIATION

CAR INSURANCE

CAR MAINTENANCE

VEHICLE LEGALITIES

TIRE REPLACEMENT

FINANCE CHARGES

CAR'S DEPRECIATION

CAR INSURANCE

CAR MAINTENANCE

VEHICLE LEGALITIES

TIRE REPLACEMENT

FINANCE CHARGES

These are just the figures about your car and do not include expenses like TOLL FEES, FUEL,and in cases of incidents like PARKING VIOLATIONS, SPEEDING, ETC.

MONTHLY EXPENSES OF using public transport

As per the data published by STATISTA.COM on Public Transportation & Mobility Services, between 2017 and 2019, bus passengers were charged on average of $58.53 for a monthly pass.

Take note that this pass is PER PERSON – meaning if two people are using the bus, that adds up to $117.06.

The $60 fee per person monthly pass is a ballpark figure because there may be different rates, benefits and running promotions of the transportation agencies and companies within your local area.

Nevertheless, you can use this data as a placeholder on that mock monthly budget of yours.

Again, do not worry, once you are here you can adjust this figure as you get to know your ACTUAL situation (distance of job from your home, the school, the supermarket, etcetera).

Our Experience

Our first apartment was very near to everything. It is right across from a shopping center. The schools were just a 10-minute walk. The supermarket, pharmacy and restaurants were just across the road.

The location of our dwelling saved us from a lot of bus rides (time and expense) as we did not have a car at first. The bus stop was 300 yards from our porch.

When our eldest decided to work for a fast-food outlet, it was reachable by an easy 2-mile ride on his bike. Thanks to the city’s generous provision of bike lanes, getting around in two wheels is easy and safe.

CREATE A BUDGET FOR CLOTHING

Clothing. This is the easiest category to create a budget on. This is because you already have clothes to start with. You just build around them depending on the following:

- - dress code at your job
  - climate in your area
  - personal preference

If you are on the frugal side like we are, you would only need to buy clothes when the occasion and circumstances call for it. And if we do buy, it is at the most affordable store we know.

We only buy clothes:

- When there is an event – for example, a wedding, a formal party, a graduation, and you do not have the appropriate clothes for it.
- When the job requires it – for example, scrubs for a family member who works in the medical field.
- School uniforms and gears for the children and for specific school events.
- When going to a place (for job or vacation) where our present clothing collection is no match to the climate. (Example: Buy skiing clothes and gear ONLY when going skiing.)

For this exercise, let us peg your collective clothing allowance, meaning for you and the whole immediate family, at $100 for the time being.

Our Experience

Since we will be relocating to the same area where we have family and friends, we already have some idea of all year climate. Prior to coming over, we already prepared the type of clothes and material of clothing to pack for our travel and stay.

Our family and friends gave us new clothes as “welcome to the USA” gifts. And we greatly appreciated the hand-me-downs as well.

CREATE A BUDGET FOR BASIC UTILITIES

This category depends on almost the same variables that apply to the Monthly Rental of a house – location, state, and unique situations.

For example, are you on your own or staying with family or friends? If so, it is not easy to put a definite value for these basic utilities – water, energy (electricity/gas), trash and recycling collection as the rates differ by state, county, and city. Even a rented downstairs unit of a house does not have its own utility meters and one can only rely on the landlord’s calculations. (Dividing the bill pro-rated and per occupant.)

Environmental conditions have a great effect on the utility bill. In an American home, the cooling and heating of a house accounts for about half of the total energy expenses.

According to the U.S. Energy Information Administration (EIA) , the average electric bill for U.S. households came in at $117.46 per month in 2020. The same site shows the natural gas prices per state.

The Circle of Blue, a nonprofit global water research organization, says depending on where you live, water consumption would cost you anywhere from $35 to $115 a month.

As for garbage collection and recycling fees, this is a direct quote from MOVING.COM :

“Most trash collection services charge customers on a monthly although some charge on a quarterly basis. Regardless of how you are billed, expect to pay anywhere from $20 per month to $80 depending primarily on where you live.“

You can use these figures for these utilities as placeholders on that mock monthly budget of yours. Again, do not worry, once you are here and you know more about the details of each, you can certainly adjust them.

Our Experience

Our first residence was a unit in a huge apartment system. The recycling and trash fees were built into the monthly rental fee, and it was very minimal.

Our electricity and gas expenses for the first six months were high because we came to the US in late fall and the cold was too much for these tropical bodies.

We would turn on the centralized heater, take hot showers and hot beverages – and those contributed a lot to the big energy expense.

CREATE A BUDGET FOR NECESSARY TECHNOLOGY

The cost for necessary technology must have a place on your budget spreadsheet.

Technology runs the world. Whether you like it or not, you and your family members must keep abreast of it and must adapt to it through everyday gadgets.

The pandemic event made remote work and distance schooling (via video conferencing) happen. Computers (laptops or desktops) and internet subscription became essential.

Cellphones are essential even for school age kids so that they have a way to contact you, and vice versa.

You can add TV to “necessary technology” if you want. You can certainly have news, movies, music and games on your small screens, but a bigger screen is better when watching common things like for when there is a movie or ballgame (like the NBA or MLB championship game).

With the gadgets comes the technology that makes them work: Your laptop and computers must be hooked up to cyberspace via the internet. Your mobile phones must be with a telecommunications carrier. And your TV must be hooked up to a streaming service via the internet or have a cable subscription. All of these (internet, carrier, streaming service and/or cable) have fees.

This is a direct quote from CNBC post dated June 15, 2021: “Americans spend a lot to stay connected. In fact, the average monthly cell phone bill in the U.S. was $127.37 last year.”

The figure stated is again a ballpark figure because the actual fee is dependent on your usage and your plan.

According to BUSINESSWIRE.COM for 2021, the average monthly cost of cable and internet is $116 or $1,392 spent per year.

You could do a bit of research as to what is the best cellphone plan for you based on your need and usage. For TV, you decide if you should have cable TV or streaming services through the internet instead.

Our Experience

Our relatives who have been in the US were gracious enough to give us their OLD cellphones and ADD us into their cellphone carrier’s family bundle.

When we got jobs already, we chose to be independent from their technology package so that we can avail ourselves of better deals from other carriers.

CREATE A BUDGET FOR MISCELLANEOUS NECESSARY EXPENSES

For this topic, let us define “miscellaneous necessary expenses” as an umbrella group of expenses that do not belong to any of the above categories. Nevertheless, they needed to be included in the budget and they usually require fees on a regular basis.

For example, but not limited to:

- All personally obtained insurance (not through employment benefits) like life insurance, medical, dental, and optical insurance, insurance of property like a car and renter’s insurance for your apartment.
- Installment payments of anything you get (appliances, dental braces, car loan, layaway plans, etc.)
- Gym and club memberships, etcetera.
- Home security subscription (alarm system)
- Education (New immigrants who want to update their skills may take courses online via monthly subscription.

There are many miscellaneous expenses, and they vary from family to family. It is best to include all these costs when you create a budget.

Our Experience

On our first month in the US, we had to get renter’s insurance because our apartment lease required it.

A few months later, when we got our first car, car insurance and car payments added up to our list of monthly NECESSARY EXPENSES.

Our dental and optical insurances were through the company we were employed at, so they were not included in our family budget as they were already deducted from the paycheck. We do not need to CONSCIOUSLY AND MANUALLY be setting aside money from them.

We have membership subscriptions but not for the gym (we are couch potatoes ). We subscribed to LinkedIn Learning because we can take courses to upgrade our skills while our resume is broadcasted on the LinkedIn platform. We also have Coursera for their certification programs as well as Udemy.

Those were some of our NECESSARY EXPENSES.

CREATE A BUDGET FOR “BUFFER FUND”

Your buffer fund (or you can name it as EMERGENCY FUND also) is money you put aside to add to an expense when the actual budget allotted for it is not enough.

Your buffer fund can be set as a percentage of your earnings, or you can also put it as a set amount.

For example, 10% of your monthly paycheck. Or you can elect to have a rounded figure like $100 per month.

For this exercise, you can put a set amount (as a placeholder and write on the printable) and you can adjust it when you have come over to the US.

Our Experience

When we started and even the first few years, money was so tight that we neglected having a buffer fund.

And when we were getting comfortable, we still did not create a budget for one right away. Talk about not practicing what we are preaching 😶.

But hindsight 20/20, we should have started a buffer fund right away.

FINAL COUNT AND PRACTICAL APPLICATION

At the end of this exercise, after adding up all the mock figures that you have, DO NOT BE SHOCKED by the big sum at the bottom.

TOTAL Monthly Budget = $4,155.00 WHAAAAAAATTTTT?????

The final figure you arrived at is quite shocking, yes, it is at first.

This happens, most especially, when your mind is still calculating based on the low exchange rate of your native country’s currency against the US dollar.

Remember, when you work and earn in the US, you will be earning IN DOLLARS, too!

With the final number you arrived at on this exercise, you now have an idea of what salary or wage you should be receiving to afford a life in the US.

Some sample questions to ponder on:

- - If my monthly budget is $________, would a $22/hour full-time job (40 hours/week) be enough?
  - What jobs should I have that pays a higher per hour rate?
  - How many of us in the family must work?
  - If there are no fulltime jobs are available, how many part-time jobs should I have to afford this amount?
  - Do I need to go back to school to get the job and salary that will support my projected monthly budget?

HOW MUCH HAVE YOU SPENT ALREADY?

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Dear new immigrants, now, do you see the benefits of making a budget even before coming to America?

We hope that you will find time to think about the points we have raised in this post and create a budget before you come to America.

And let us know how it went for you in the comments section. Thank you!

MOMSENSE Maria

Maria is just a chatterbox (on a mission.😋)

NO ONE AUTHORIZED her to spew all this MOMSENSE, but she is a complicated cat and so she feels that she must. Be advised and take a spoonful of salt for every opinionated post you read here. And please, please consult a professional for individualized advice on life-altering decisions.

MOMSENSE Maria

Maria is just a chatterbox (on a mission.😋) NO ONE AUTHORIZED her to spew all this MOMSENSE, but she is a complicated cat and so she feels that she must. Be advised and take a spoonful of salt for every opinionated post you read here. And please, please consult a professional for individualized advice on life-altering decisions.

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