1. What is the Rent Affordability Rule?

The 30% rule is a common guideline that suggests you should spend no more than 30% of your gross monthly income on rent. This helps ensure you have enough left for other expenses and savings.

2. How Does the Calculator Work?

The calculator uses the simple formula:

Where:

• \( Rent \) — Affordable monthly rent (MYR)
• \( Salary \) — Gross monthly salary (MYR)
• \( 0.3 \) — 30% affordability threshold

Explanation: This calculation provides a conservative estimate of what you can afford while maintaining financial stability.

3. Importance of Rent Affordability

Details: Keeping rent at or below 30% of income helps prevent being "house poor" - spending too much on housing at the expense of other financial goals and necessities.

4. Using the Calculator

Tips: Enter your gross monthly salary in MYR. The calculator will show the maximum recommended rent based on the 30% rule.

5. Frequently Asked Questions (FAQ)

Q1: Is the 30% rule before or after tax?
A: Typically calculated using gross (before tax) income, but some prefer to use net income for more conservative estimates.

Q2: What if my rent needs to be higher?
A: You may need to adjust other expenses or consider roommates. Exceeding 30% may strain your budget.

Q3: Does this include utilities?
A: The 30% should ideally cover rent plus utilities. If utilities aren't included, you might aim for 25% on rent alone.

Q4: How does this apply in different Malaysian cities?
A: In high-cost areas like KL, you might need to adjust the percentage slightly, but try not to exceed 35%.

Q5: What if I have significant debt payments?
A: With high debt obligations, you might need to aim for an even lower percentage (20-25%) for rent.