Single Parent Finances: 5 Money Management Tips For Single Moms

Are you struggling to manage your finances as a single mum? This article will teach you how to manage your money more efficiently when you’re taking care of your child on your own. Keep reading below to find out our five tips for upgrading your financial situation.

During the most overwhelming, stressful, and desperate moments, being a single parent may feel like the craziest financial decision you’ve ever made. You may be thinking “How did I ever imagine that I can handle everything on my own?”. These moments are those when you have to decide between buying gas for your car or groceries to feed your family. Or those moments when you take extra night shifts and get home exhausted while other parents are likely resting comfortably in their beds.

Money comes in and then goes back again. You pay one bill only for another one to show up. You work hard, but you feel like you’re not making any financial progress.

But, no matter how difficult it may seem at times, the truth is that you can handle being a single parent. All you have to do is to learn how to make smarter money management choices. This article will teach you how to manage your finances more efficiently when you are the single head of the household. Here are five money management tips every single mum struggling with finances should know:

Table of Contents

1. Create a Family Budget

Let’s face it: it really difficult for anyone to stick to a budget when they don’t even have a clear idea of what that budget is. In other words, how can you know that you’re spending too much when you don’t even know exactly how much you can afford to spend?

So, when you want to learn how to make smarter money management decisions, you need to start by creating a family budget to get a clearer idea of the numbers.

Start by determining your net worth, including any child support you receive if that’s the case, and your obligatory monthly expenses, such as bills, debt, food, you kid’s education expenses, and other living costs. Do the math and see how much money you’re left with after paying for all these mandatory financial responsibilities. This way, you’ll know how much extra money you have left for spending on your wants and for saving.

Have you heard about the 50/30/20 budgeting rule? It’s actually pretty simple and works for many people:

50% of your earnings go to housing, bills, food, and other financial responsibilities.
30% go for your wants.
20% of your earnings should go to a saving budget.

It would help if you aimed towards a similar distribution of your budget for a healthy financial future.

2. Get Real About What You Can Afford

Since you are the only earner in your family, you need to be very aware of the fact that you’ll also be the only one paying for stuff like living expenses, debt, and emergencies.

Whether you’ve become a single mother via a divorce, unplanned pregnancy, choice, or widowhood, it can be really tempting to look around yourself and aspire to have the lifestyle of those two-parent families. Yet, if you are reading this, then chances are that you likely can’t afford that. Not yet!

You’d probably also like to go on a luxury vacation in a Caribbean resort or to send your child to expensive summer camps. But these are things that you may afford in the future, not right now. So, don’t feel in any way pressured to spend more than you can afford so that you are like the rest of the parents you see around you.

In other words, don’t try to replicate nuclear-family neighbours’ lives if that means having a lifestyle you can’t afford.

3. Be Smart with Major Investments

Like it or not, no matter how strapped for cash you may be, there are some moments when you have to make some pretty expensive investments such as buying a home, purchasing a vehicle, or paying for your kid’s school or education. When you have to make these investments, make sure that you see them as long-term investments and get the best deals.

For example, say your old car stopped working, and you need to purchase a new one so that you can commute to and back from work every day. You can buy a used car because used cars are often cheaper and you can find one that works perfectly.

Or, say you are on the fence about whether you should purchase your own home or continue to rent a place until you’re more financially successful. In that case, investing in a home of your own simply makes more sense. You already have a family, meaning that you’re ready to settle down in your own home. What’s more, the monthly rent you pay for the place you live in right now is money you’ll never see in the future, whereas paying the same amount of money monthly for a mortgage payment will help you have a home of your own at the end of the mortgage. Look for the best rate mortgage calculator to choose a mortgage plan that suits your current financial situation.

4. Get a Safety Net in Place

You know what they say, “It’s better to be safe than sorry.” Healthy financial management also means that you need to be prepared for the unplanned, things like health emergencies. So, besides having an emergency fund, you should also protect your family’s financial future with health, life, and disability insurance.

To have a healthy financial future, you must also make sure that even a small part of your monthly net goes to savings and insurance.

5. Increase Your Net Worth

There’s no nicer way to say this: if you want to have a great financial situation, you must not make your professional decisions as “a single mum”. Don’t keep making your professional decisions with your situation from home in mind. If you want to earn more money, you need to go big. Chase that raise, even if it means working some extra hours each week, continue your studies, even if it means temporarily hiring a babysitter, and don’t fear saying “Yes” to a better- paid job, even if that means a few changes in your life and your child’s life.