First, I factored in rent. Based on analysis by the Australian Council of Social Services, I took out $185 per week - that's around what you pay for the cheapest available 1 bedroom apartment in a metro area.(1) If you factor in Rent Assistance, that leaves you with just $17.15 per day for all other costs - bills, food, transport, the lot.

My next step was to budget for all those essential fixed costs that you have to cover. I set enough money aside to pay for power, gas and the small mobile phone credit recharge amount that would still keep my phone connected in case an employer called. If you're on Newstart, applying for jobs, you've got to have access to a phone in case someone wants to ring and offer you work. You're forced to give up your landline - or choose between it and healthy food.

I've also factored in all the bus and trains tickets I will need to visit to my local Centrelink and Job Service Provider, as well as trips to apply for jobs and to the shops. At $2.56 a return trip on concession, it starts to add up pretty quickly when you need to be looking for work right across town.

After taking all of these essential costs into account, I went from having $17.15 a day down to just $10.11 a day for everything else - food, toiletries and cosmetics, emergencies and so on.

If anything went wrong - I broke my glasses, a car breakdown, an unexpected bill, anything like that - I would have to rely on savings, a credit card, a pay day loan, or help from family or friends to get by. A friend of mine has just been hit with a $1400 car repair bill. She's on a pension and can't afford to get it repaired - and it's her only means of transport. Once a crisis like this happens, life changes drastically for someone on Newstart or another allowance.

60% of people are on Newstart for more than 12 months while they look for work. As someone recently told me on Twitter, sometimes stress comes from the unexpected: any unexpected cost puts everything at risk when you're on Newstart for any length of time. It makes it so hard to look for work.

Over the next few days, I'll look at the application process through Centrelink and how it forces you to run down your savings, how much time and money it takes to look for work - and what happens when a crisis strikes. For people are doing this, month in, month out, while they study or look for a job, it would become increasingly more difficult to keep afloat, even using all your ingenuity and sticking to the strictest of budgets.

Daily expenditure: $234.21 (fixed costs). Money left in my wallet: $70.74.

Day 2: Rachel cooking & eating on Newstart >

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Increasing the allowance rate by $50 per week - $7 per day - would be an important start to make things a little easier for the hundreds of thousands of Australians relying on this assistance. You can follow my week on my Facebook page, and you can read more about this issue in our background paper.

(1) The housing costs are in many ways too optimistic, as we know from last year's Anglicare Annual Rental Affordability Snapshot that less than 1% of metro homes nationally are affordable to low income earners. This calculation is also just one formulation of the many different circumstances that people find themselves in - already we've heard from retrenched workers with people mortgages, people with extremely high rents, that are 70% or more of their weekly income. We know that there are whole families who are homeless, or living in a single room. Access to affordable housing is an important issue for the Greens, that my colleague Scott Ludlam has been a tireless advocate for.