Raising and nurturing a child can be a financial challenge, considering one must bear the ongoing costs of their education, extracurricular activities, and other everyday needs. Things can get more tricky for single parents, as they have nobody to share the monetary burden with. For that reason, they need to be doubly careful about their spending. The right budgeting tips can help single parents sustain themselves and their kids and become financially stable.
Create a monthly budget
While the internet has a ton of financial advice for single parents, the most basic recommendation is to make a budget. A well-planned budget greatly helps single parents struggling to make ends meet. The budget must be created by adding all income streams and subtracting expenses from that amount. One can use a pen and paper to write down the numbers or feed them into a spreadsheet or mobile application.
An excellent way to determine one’s expenses at the end of the month is to look at the receipts and loan statements. Documents such as pay stubs and bank statements also paint an accurate picture of the money debited from the account during the month. To calculate the savings or income, one can add up the money received for child support, income from monthly savings account interest, and salary for part-time employment.
If money is left at the end of the month after subtracting the total expenses from the total income, one can put that in their savings account. On the other hand, if the end-of-month budget shows the balance in red, individuals will need to either cut down on avoidable expenses or generate additional income.
Manage debt wisely
When transitioning into single parenthood, people often try to leave the past behind and begin life in a new location with their children. Moving into a new house and making necessary living arrangements costs a lot of money. People who cannot meet the expenses of this new beginning often borrow money, leading to debt. Settling this debt as quickly as possible is important for single parents to give themselves and their children a quality life moving forward.
Thankfully, there are several ways to reduce debt. A popular solution is debt consolidation, where multiple loans are clubbed into a single loan. This benefits single parents as they no longer have to track multiple credit accounts. Also, the new loan’s interest may sometimes be lower, helping save money. People can negotiate with banks or lending institutions to restructure their loan repayments and lower interest rates.
If debt consolidation is not an option, and a person has to manage multiple loans, they must prioritize the payments. The highest-interest debt must be paid off before tackling loans with a low interest rate. This is among the popular single-parent budget hacks to save money while repaying debts.
If none of the techniques are viable, single parents can contact non-profit credit counseling to find solutions to their monthly debt obligations. Once a person becomes debt-free, they must not add new debt. This can be done by saving money as a single parent and maintaining financial discipline.
Seek discounts and use free resources
One of the most useful money-saving strategies for single moms and dads is to seek discounts when paying for services. For example, many museums and zoos have free or discounted admission on specific days every week. Visiting such locations during those times can help single parents provide their little ones with a little fun time without spending much.
Apart from seeking discounts, one can take advantage of various free resources for single parents. One such resource is the Single Mom Society, a non-profit community sponsored by a charitable institution. When single moms sign up for their free membership here, they get free access to resources for housing, financial assistance, education, transportation services, career counseling, legal assistance, employment, business assistance, and more. These free services can save thousands of dollars every year for single mothers.
Plan meals to reduce wastage
Another affordable living tip for single parents is to repurpose leftover food. Single parents can cook fresh meals during weekends and use the leftovers to make and serve meals on Mondays. They can use this same strategy for Tuesdays and Wednesdays. Repurposing leftovers allows people to be creative and try new recipes and dishes. It also saves a lot of money and resources that would otherwise be wasted at the end of the day. Affordable meal planning may take some effort, but single parents will benefit from it in the long run.
Take advantage of single-parent tax benefits
Many may not know this, but the government offers financial perks to make saving money as a single parent easier. Several sections of the tax law have provisions that make single parents eligible for specific exemptions, benefits, rebates, and credits. One must check their tax eligibility online. Tax savings can help single-parent households with financial planning.
There are several other ways for single parents to save money and raise their children without hassles. Some such strategies include setting short-term and long-term financial goals, diversifying income streams, investing in a varied portfolio, and purchasing insurance.
