As a single parent, you must plan ahead to stay on top of your finances.
Financial Problems Often Faced by Single Parents
As you have to bear the burden of your finances all alone, it’s important to plan ahead as otherwise you can easily get into trouble.
Not tracking your expenses or budgeting
If you don’t stay on top of your spending, you can fall in the trap of not living within your means. If you spend more than you earn, it’s only a matter of time before you end up under a pile of debt which will cost you a lot more than money to repay.
Not being prepared for emergencies
Building an emergency fund is even more challenging when your finances are limited. But, unexpected expenses are bound to arise and if you don’t prepare accordingly, you’ll add a lot more stress to an already stressful situation. Put even a small amount aside each money can do a good job in protecting you against a financial downfall.
Poor credit score
You never know when you might need credit to get you through so if you don’t pay bills on time or monitor your credit score, you might not have access to credit when you need it the most.
Using too much sick leave
Between yours and your children’s illnesses, it’s too easy to max out your sick leave. Without a support system of friends and family, your salary and job could be at risk.
Budgeting Tips for Single Parents
Being a single parent comes with a tremendous pressure to figure things out for yourself and fast. Finance issues are a common challenge for single parents, so it is important to learn how to budget and be frugal with your spending.
List all your expenses
To avoid getting overwhelmed, list all your needs such as rent, utilities, groceries and debt as you afford to trim your wants for a while or at least until the situation improves.
Constantly assess your budget
It’s important to analyze your expenses by going through your budget one line at a time and figure out where you can reduce them. A budget will also change month to month, so it’s important to assess it and make changes when necessary, i.e., when you need to pay for your summer holiday, a trip to Disneyland or buy Christmas gifts.
Start looking for money
Consider adopting energy-conservation habits such as by turning up your air-conditioner a few degrees during summer or turning off lights whenever you can to save on energy bills. Do you need so much data on your phone? Can you live without cable or Netflix for a while? Don’t forget to take advantage of tax credits and deductions as a penny saved is a penny earned.
Compare prices
Price comparison is a great way to save money. All you have to do is shopping around for prices. You should also apply this approach in finding a more affordable PECO utility rate as your utility bill eats up a significant part of your budget so any effort to reduce it will be worth it. It’s beyond easy to compare prices these days thanks to a ton of price-matching websites and browsers.
Simple Money Saving Tips
Here are a few useful tips to stay on top of your finances.
Build your meals around grocery store sales
Use coupons, rewards and loyalty programs when grocery shopping and just build your weekly menu around it.
Keep your pantry stocked
A well-stocked pantry can make cooking easier, healthier and more affordable as you’ll be less tempted to spend money on less healthy takeaway.
Embrace second-hand
Hand-me-downs will save you a ton of money on toys and clothing. You can also sell things your kids no longer need.
Make your home into a daycare
If you cannot afford daycare with your daily job, how about being a stay-at-home parent that earns an income by providing licensed day care. You will already be taking care of your kids so it won’t change things much for you but your kids will get playmates, so they get to play together, while you earn considerable money. It’s hard work but it’s rewarding.
Takeaway
Being a single parent is undoubtedly a stressful time for everyone involved, but it doesn’t mean that a financially healthy life is not an option. Raising a family on a budget is a daunting task and things won’t be easy, but they can be easier with a little bit of creativity and strategy.
