What Are Utilities? A Guide for Renters

Moving into a new rental is usually exciting. But figuring out the utilities? Not so much. After all, you’re taking on a fresh set of financial responsibilities alongside the new digs. And particularly for first-time renters, understanding and setting up utilities can be tricky, as each property handles them a little differently.

So what are utilities, and how can they affect your monthly budget? Below, we'll break down the different types, explain how they vary between apartments and houses, and offer smart ways to keep your costs in check.

Types of Utilities

To manage your monthly budget effectively, you must understand what utilities are considered part of the rent and which you’ll need to set up and pay for yourself. Here are some examples of utilities you’ll commonly encounter. Before you sign on the dotted line, find out which utilities are your responsibility versus the landlord’s and how they’ll impact your finances.

Electricity

Your electricity bill covers everything that draws power in your home. Along with major appliances, the main cost drivers are heating and cooling, which means your bills usually vary alongside the seasons. Electric water heaters, washers, dryers, and refrigerators also pull significant energy around the clock.

Depending on state regulations and your particular lease terms, you may be required to use a specific provider for your area or facility. But 18 states plus Washington D.C. have deregulated energy markets. This means you may be able to shop around for the best deal among electric providers. Check your lease and local regulations to find out whether you choose your own power supplier.

Water and Sewer

Water and sewer services cover everyday water usage plus the system that carries wastewater away from your unit. These services are almost always managed by your local municipality, so you probably won't get to choose a provider. However, unless you rent a property where you might need to water the lawn or maintain a pool, your bill should remain fairly constant throughout the year.

Gas

Natural gas can fuel various heat-related appliances, such as ovens and ranges, water heaters, and furnaces. But many modern buildings have moved entirely to all-electric systems and appliances, so gas setup and billing may not be necessary.

Just as with electricity, some states have deregulated gas markets. While delivery may be provided by a single company, you may be able to choose your supplier if your lease allows external vendors. 

Internet and Cable

Many rental facilities offer wired internet and cable services through one or two providers. Options are limited to your local area if you’re using wired services. If your lease permits, you can also consider wireless services, such as wireless broadband, satellite internet and TV, and fixed wireless. 

Trash and Recycling

In most apartment complexes, the building provides dumpsters or a trash room. But if you're renting a house or townhouse, you'll likely need to set up service yourself through a local waste-collection company or your municipality. Depending on local regulations, you may or may not have a choice of collection services.

Utilities in an Apartment vs. A House

What counts as utilities, and who pays for them, varies depending on whether you're renting an apartment or a house. Here’s how utilities usually work in each environment.

Utilities in an Apartment

In a typical apartment setup, landlords often cover a few services, such as trash and recycling and maybe water and sewer. However, you’re generally responsible for setting up and managing your own electricity, gas, and internet and cable accounts. While seasonal changes and personal circumstances can affect your final bill, for the most part, utilities in an apartment are fairly stable. 

Utilities in a House

Renting a standalone house or townhouse usually offers plenty of space and privacy, but it can also raise your bills. Most often, renters pay for each utility separately from rent.

Plus, the added square footage and potential lack of shared walls means your electricity and gas bills are often higher. You may also be required to maintain a lawn or pool, which can increase water bills. 

How To Set up Utilities When You Move

When you’re moving into a new rental, you already have a lot on your to-do list. But setting up your utilities should be near the top. After all, you don’t want to end up sitting in a new — but dark — apartment on move-in day or fielding a surprise bill weeks later.

The following steps can help you coordinate your utilities:

• Check your lease: Review your lease’s definition of utilities, and note who’s responsible for each type of service. Also review any stipulations about whether you need to set up these services on your own.
• Confirm local providers: Ask your landlord for a list of utility companies servicing your building and whether other options are available or restricted. 
• Set up accounts early: Once you’ve identified your providers, set up service at least one to two weeks before your move, as some require several business days to activate your connection.
• Align start dates: Match your utility activation to the lease start date to avoid paying for a previous tenant's use or experiencing a gap in service. 

Some rental complexes have utility transfer programs where accounts automatically roll over to a new tenant. While this may limit your choice of utility companies, it can also save you time and hassle. Check with your property manager to see if that's an option or even a requirement.

How To Lower Your Utility Bills

You can’t avoid utility payments entirely, but you can keep these variable expenses in check. Here are a few practical ways to minimize utility costs:

• Adjust your thermostat: Lowering the temp a few degrees in the winter and raising it in the summer can make a big difference in electricity and gas bills.
• Unplug devices: Electronics and chargers draw standby power even when they're turned off, so unplug what you're not actively using.
• Manage windows, doors, and window coverings: Keep them closed as much as possible during peak heating and cooling hours. Drafts around windows and doors also force your HVAC system to work harder, so if your building allows, seal gaps with weatherstripping.
• Compare plans: Utility providers run promotions regularly to score new business. So if you’re allowed to choose between utility companies, review your plans every year to make sure you're not overpaying. 
• Use fans: Ceiling and portable fans circulate air effectively, and running them costs far less than using air conditioning. Pairing them with a slightly higher thermostat setting gives you comfort without the spike in utility costs.
• Check out assistance programs: Many utility companies and local governments offer low-income energy assistance, discounted rates, or weatherization programs. A quick search or phone call can uncover significant savings.

Manage Your Everyday Bills With Flex

Cutting utility costs certainly helps your budget. But even a lower bill can batter your bottom line if it’s due before your next paycheck. And when unexpected or periodic expenses (e.g., vehicle maintenance or pet care) hit too, that can cause some trouble. Often, though, the issue isn't the amount — it's the timing.

Flex solves the timing problem. It helps renters split everyday bills, such as utilities, monthly rent payments, and insurance into smaller payments better aligned with when you actually get paid. That way, you don’t drain your account once a month or miss critical deadlines waiting on your paycheck. 

While Flex is best known as a rent-splitting application, we also help renters manage their essential monthly expenses all in one place. 

Want to split your bills? Add them to Flex to get started.

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FAQ

What's the Difference Between a Public Utility and a Private Service Provider?

Public utilities, like electricity, water, and gas, are often regulated by government commissions that oversee pricing and access. Private service providers, like internet and cable companies, operate in a competitive market where prices are set by competition rather than public oversight. That said, some states have deregulated energy markets, which means you have the power to choose between public utility providers. 

Is the Internet Always Considered a Utility? 

While internet services feel essential, they’re not regulated the same way as public utilities. Most leases treat internet services as an add-on utility paid by the tenant. However, a few bundle internet and maybe even cable into rent payments.

Which Utilities Are Tenants Often Expected To Set up Themselves?

Many multi-unit complexes bundle water, sewer, and trash collection into rent, and renters set up and pay for the rest of the utilities. But some facilities and most house rentals require renters to create utility accounts and pay the bills themselves.