A single mother trying to run a household is five times more likely to live in poverty than a family helmed by a married couple.
While budgeting is a topic that many struggle with, single moms have the added challenge of managing finances on their own – with kids to raise. If you’re in this boat, take a look at 6 habits you can adopt to get ahead financially.
Learn How to Budget
Learning how to budget is the number one factor if you’re a single mom looking to manage your finances. When juggling a job and kids, plus paying for everything solo, a budget helps keep you on track. It also provides a window to see where you’re spending your money. With a budget in place, you’ll be able to make better decisions and figure out where to cut out unnecessary expenses.
So where should you start when it comes to creating a budget? There are plenty of options, including writing everything down with a pencil and paper, or using an online solution like Every Dollar, YNAB (also known as You Need A Budget) and Mvelopes. All of these online software options make creating a budget (and following it) easy.
Before you do anything, however, you first need to determine your budgeting style, and then use the proper tools and software that will work best for you. There isn’t a one size fits all budgeting answer, so you can tweak and change your budget whenever you want to.
Automate Your Savings
It may be hard to save money as a single mom, but even as little as five dollars per paycheck is better than not saving at all. Also, by automating savings, you won’t even notice the money being saved and it will seem effortless.
To start automating your savings, check out Chime. With a Chime bank account, you can save without even thinking about it. Not only can you save 10% of your paycheck every time you get paid, but Chime also offers a round up feature whereby every purchase you make with your Chime debit card is rounded up to the nearest dollar. This round up spare change is then deposited into your Chime Savings account. While saving your change may not sound like much, it is helpful when saving for a rainy day. This brings me to the next point.
Have an Emergency Fund
There will come a time when an emergency fund is needed, and a single mom doesn’t have the opportunity to turn to a spouse or significant other for financial help. This is why it’s important to save up for emergencies for socking money aside into a separate account.
Having an emergency fund can keep a single mom from getting into debt, or worse, not being able to afford essential necessities, such as car repairs or home repairs. While there isn’t a hard or fast rule as to how much you should save in your emergency fund, you should tailor it to your current income, expenses, and what you deem acceptable.
Don’t Be Afraid to Ask For Help
The U.S. Bureau of Census conducted a survey in 2016 which concluded that child support represents 47% of a custodial parent’s income who receive child support and lives below the poverty level. Whereas child support is beneficial, there are also other programs and resources that offer financial, educational, and housing assistance.
Temporary Assistance for Needy Families, also known as TANF, for example, can help you find employment, on-the-job and vocational training, and child care assistance. Other beneficial programs include Supplemental Assistance for Needy Persons (SNAP) and the Women, Infants, and Children program, also known as WIC. These are both resources for supplemental food and nutrition. In some cases, they provide single moms with debit type cards to help purchase food.
While these resources were put into place to help mothers in financial need, they are also considered temporary resources so that mothers can get back on their feet.
Teach The Kids
When you’re trying to take care of your family’s financial needs, it can be hard to teach the kids about smart financial habits. Yet, this is important – especially if you want your kids to grow up to be financially self-sufficient.
Former single mom Chonce Maddox from My Debt Epiphany, for example, teaches her son about living simply, saving for a rainy day and avoiding debt. She also gives him a small allowance and is teaching him how to handle the money he receives responsibly, including how to save for the future.
Books, podcasts, and even television programs can also help you pass along important financial lessons to your kids. Not only is financial education the best way to break the debt cycle, but it’s also a way for your to bond with your kids while learning about healthy money habits.
A single mom does not have to struggle financially while raising her children. It is possible for the average single mom to be smart financially and have healthy money habits. These habits aren’t hard to accomplish or follow through with. All they take is willpower, a willingness to get help when needed, and the ability to learn and grow through saving, budgeting, and hard work.