Single moms can have a challenging time getting ahead financially without a second income to support a household. You may be working hard just to make ends meet, and the idea of saving money or investing for the future may seem out of reach.
But it is possible to get ahead financially as a single mom. With some planning and thoughtful money moves, you can set yourself up for a bright financial future.
Here are some tried and tested financial advice and tips on how to get ahead as a single mom:
Draw up a well-thought-out budget and stick to it
This piece of advice might sound ancient and obvious, but it truly still remains one of the best ways to get ahead financially. Albeit, it does ask for commitment and perseverance month to month. Knowing where your money goes each month makes finding places to cut back and save just so much easier. There are several helpful budgeting apps and tools out there that can make the process easier and more trendy (whatever it takes, right?)
Focus on yourself
Invest in yourself. It might sound unachievable, but it will be one of the best long-term investments you can make.
If you have the opportunity to further your education or take on new job training, do it. It may require some upfront investment, but it will pay off in the long run in terms of increased earnings potential.
Make saving a priority
It may seem like an impossible cause to save money when you are already struggling to make ends meet. But it is important to make it a priority. Even if you can only afford to save a small amount each month, it will add up over time.
You have many achievable options to pursue to save money, such as setting up a regular savings account or to start investing in a retirement account. If you struggle to save on your own, programs like Save the Children can help you get started.
Live below your means
The best advice for getting ahead financially is to live below your means. In other words, don’t spend more than you make. This may seem difficult at first, but adjusting your lifestyle to live within your means is possible and rather easy once you set your mind on it.
Some ways to live below your means include cooking at home instead of eating out, driving an older car, and avoiding unnecessary expenses and shopping sprees.
Have a plan
It is crucial to have a financial plan in place so that you know where you want to be financially in the future. You will easily get sidetracked without a writtern down plan. You can end up spending money on things that are not really necessary.
Creating a budget and sticking to it is one part of having a financial plan. But you also need to set goals for yourself so that you have something to work towards.
If you dream of buying a house someday, start saving now to have the down payment when the time comes. Or, if you want to retire early, start investing now to reach your goal sooner.
Get life insurance to help you financially when you need cash
There are several different things that life insurance for mums can do for you financially. One of the most important is that it can provide you with cash when needed.
If you have a term life insurance policy, you can use the death benefit to pay off debts, cover final expenses, or provide financial support for your family. The cash value can be accessed through loans or withdrawals if you have a whole life insurance policy.
Either way, life insurance can provide you with much-needed financial assistance when you are facing difficult times.
Invest in a retirement plan early on
Investing in a retirement plan is one of the smartest things you can do for your financial future. The sooner you start, the more time your money has to grow. And, if you invest in a tax-deferred retirement account, like an ISA or a 401(k), you can also save on taxes now.
There are a number of different retirement plans to choose from, so it is important to do some research to find one that best suits your needs. But regardless of which plan you choose, the most important thing is to start investing now to reach your retirement goals.
Do not try to keep up with the Joneses
One of the biggest financial traps people fall into is trying to keep up with the Joneses. They see their neighbours and friends buying new cars, going on fancy vacations, and generally living a lifestyle that seems out of reach.
But they don’t realize that the Joneses may not be as well off as they seem. In fact, they may be struggling to make ends meet. Or, even if they are doing well financially, theirs is not necessarily the life you want to live.
Focus on your financial goals and do not worry about other people’s actions. You will be much better off in the long run if you do.
Start an emergency fund
It is one of the best things you can do for your financial future. This savings account you use for unexpected expenses, like medical bills or car repairs.
You should work towards having enough money in your emergency fund to cover three to six months of living expenses. It can help you avoid going into debt when an emergency does occur.
Get help if you need it
Don’t be afraid to seek out help. Many resources are available to single moms who need assistance with things like budgeting, saving, and investing.
Some places to look for help include your local United Way, community action agencies, and religious organizations. You can also search online for financial assistance programs specifically for single mothers.
Getting ahead financially as a single mom may seem daunting, but it is possible with some planning and effort. As you can see, there are many things that you can do to get ahead financially. Most importantly, get started now. So take some time to create a financial plan and set some goals for yourself.