For many single moms, there simply isn’t enough time at the end of the day to think about all of the important personal finance issues that most two-parent families are able to methodically work through.
But a lack of time, doesn’t mean you can’t be smart with your money. You owe it to yourself to give your family’s personal finance issues the attention they deserve.
Familiarize Yourself With These 5 Best Practices
If you’re overwhelmed and unsure where to start, these five tips will get you moving in a positive direction…
- Create a Monthly Budget
The very first thing you need to do is create a family budget so that you know exactly how much money is coming in each month and precisely how much is going out.
There are many different budgeting strategies, including some pretty complex ones, but there’s no need to overdo things. A simple zero-sum budget where you allocate every dollar you earn to a specific category should do the trick.
- Start Saving Money
Once a budget is created, most people realize (a) that they’re spending too much on things that don’t matter, and (b) that they aren’t saving nearly enough. Even if it’s just a hundred dollars per month, start stashing some money away in a liquid savings account so that emergency expenses don’t sneak up and hurt you in the future.
- Deal With Bad Credit ASAP
Are you plagued by bad credit? Millions of Americans are, but that doesn’t mean it’s something you just accept and suffer through. It’s time to take a hands-on approach. Here is an in-depth guide about dealing with bad credit when you want to buy a home from the Consumer Financial Protection Bureau.
- Plan for Your Child’s Future
Want to do yourself a favor that will make you smile in 10 or 15 years? Start planning for your child’s future by saving money for things like cars and educational costs. Thanks to the power of compounding interest, saving a little bit of money every month in a growth account can yield amazing dividends over a long period of time.
- Live Within Your Means
Most Americans, perhaps yourself included, have been sold a bill of goods when it comes to the American Dream. You’ve been told that you have to keep going into debt and eventually you’ll become financially successful. As a result, Americans spend billions of dollars each year on things they can’t actually afford in the form of car loans, mortgages, student loan debts, and credit card debt.
While most people would agree that there’s nothing wrong with a little debt – especially when it’s an appreciating asset like a mortgage – it’s time to start living within your means. If you make $50,000 a year, don’t live a lifestyle that pretends you make $150,000 a year. You might fool yourself for a few months or years, but it’ll eventually come crumbling down.
Give Your Family a Strong Financial Footing
Money can be a major source of stress for any parent, but especially for a single mother who has dozens of important responsibilities to worry about.
If you’re a single mother, I hope these tips help your manage your finances and build a strong foundation for your family to build its future on.