As a single mom, you have plenty of responsibilities on your hands as you raise your children and be the best mom you can be. Your children depend on you for everything, and without another income for your family, it can be challenging to navigate financial responsibilities. Things can get expensive quickly if you don’t properly manage your finances.
Regardless of marital status, adults need a plan of action for their financial goals. It offers a more comfortable future and can help you meet your current needs as a parent. Single mothers often do whatever it takes to keep their families afloat, but their main goal is to decrease their expenses and increase their income.
Although every single mother’s financial life is different, they can all learn from these six financial tips for single mothers.
1. Pay Off Your Debts
The first step to financial freedom is to pay off debts. Whether you have loans for school, your vehicle, household items or utilities, create a plan to pay off the debt. If you have to finance something, you probably can’t afford it, so steer clear from things that don’t fit into your financial lifestyle. Focus on paying your debts as soon as you can. The less money you owe, the more quickly you can build your wealth and achieve your financial goals.
2. Start a Budget
If you don’t already have a budget in place for every expense, start one. Through a budget, you can better make monetary adjustments and decisions for you and your children. There are plenty of apps available that can help you track your expenses. Ideally, you’ll want to include things like debt, housing, car, clothing, food, healthcare, entertainment, child care, taxes, investments, and other miscellaneous expenses for a budget.
A good rule of thumb is the 50/30/20 rule. Up to 50% of your income should be for needs, 30% for wants, and save 20% of your income for savings and debt repayment. Track your progress for about a month and see how your budgeting is going, then make adjustments. With a budget, you can begin to prioritize your expenses so you can plan out your monthly income.
3. Build an Emergency Fund
Next, you’ll want to start to build an emergency fund. You might already have an emergency fund for yourself, but you’ll want to make sure it can accommodate both you and your children. The goal for an emergency fund is to have about three to six months of any basic living expenses, like food and housing, put away in the event of an emergency, like a natural disaster or job loss. Make sure to include the expenses of your kids, too.
4. Find Inexpensive or Free Activities
Without an extra stream of income, your children’s activities can get expensive. Paying fees at amusement parks, purchasing equipment for sports or paying for flights for a vacation can add up when you’re on your own. Instead of feeling like you have to do all of these expensive things to keep your kids happy, save your money and opt for inexpensive or free activities. Take your children to museums with free admission, matinee movies or take advantage of the outdoors.
5. Educate Your Children About Finances
Another great financial tip for you as a single mother is to educate your children about finances. Once you grasp your financial situation, you can begin to show your kids how to take care of money. They learn the importance of money from you as a parent, especially as they watch you carefully save, invest and spend money daily.
Teach them about what it means to have needs and wants. Explain how you earn money, like through jobs and investments. One way to help them better understand the value of money is by giving them a small allowance and helping them budget to manage small expenses.
6. Increase Your Income
Finally, find ways to increase your own income. Single mothers sometimes need extra money for things like childcare and daily costs. If your family life allows it, be open to working more or finding an additional part-time job.
You could ask for a raise if you think you have earned it. Find people to watch your kids for free. Go for a promotion at work or even start your own small business from home. Sell items you no longer need or use. Invest in yourself if it helps you make more money.
Getting Right with Your Finances
You can become financially independent and stable using these six tips for single mothers. Pay your debts, learn to budget and use your money wisely.