Single Moms Getting Serious With Their Money
The number one source of stress for single moms is income, cash flow, money.
Single moms seem to have 99 problems and the majority of us would say 89 of those are income related.
For anybody it's important to be financially independent, but this is that much more important for women, and even more so for single women with children. The statistics show that very few single parents receive the child support owed to them and, which means often women are left as the sole provider for their family and are statistically poorer compared to their married counterparts.
This is a huge responsibility to shoulder alone, which means it's crucial that single mothers get a hold of their financial situations and get deadly serious about it.
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1. Don't be scared of your debt and face it. Whether you've accumulated debt as a result of a divorce, from school, poor money management, or however it came about, many, many single moms are carrying a baggage of debt around with them and the heavy stress that follows. If you're a single mom living pay-check to pay-check, the idea of even glancing at your debt can raise your anxiety level. This can be especially frightening to calculate if you're not even sure how you're going to pay rent next month, much less start paying off debt. But it's time to be brave and take a good hard look at it. You can't fix what you don't know.
Be aware of how much debt you're in so you can start taking proactive steps in tackling it. There are many methods out there like the popular "snow ball" method from Dave Ramsey, but you won't find the best solution if you don't know what you're up against. Sit down; grab your calculator and start getting those numbers down. It might sound outrageous but this is one of the first steps toward regaining control of your finances.
Take a look at your credit report to see who you owe money to (and see if there are any discrepancies), if you have bill collectors calling, save their numbers and what debt they're collecting for as well. You can also check for student loan debt here.
2. Make a budget and develop discipline. You've probably heard the great advice to budget before, but in reality, it can be hard to stick to it. It's one thing to have a pretty spread sheet, it's another to actually take a look at it and follow it faithfully. If you find you can't stick to a budget because your expenses are more than you're income, it's time to raise your income or cut your expenses. When you've looked at your budget and felt like you've cut all the expenses you can, take a second look and be honest about your vices and "treats". Even small things like buying large amounts of soda during grocery trips, renting Redbox movies daily (and not returning them too!), eating out often, etc can add up pretty quickly.
If you just suck at creating a budget like me, download the Mint app. This nifty app will not only make a budget for you, but it tracks your spending habits, tracks your credit score, and you can even sync it with other companies to auto pay your bills.
You can also help cut some of your expenses by double checking where your money is going to and if there's better prices such as your phone bill or auto insurance. I have insurance through Root and absolutely saved money. The app tracks your driving habits for 4-8 weeks and then offers you a rate based off of your driving habit; I'm happy with my car insurance and would suggest anyone to give it a try!
3. Utilize resources. So maybe you really have cut down to the bare minimum and you're working on raising your income (that doesn't always happen in the time frame we need it to!) it's time to start looking into resources.
There's absolutely no shame is getting government assistance to help you until you get on your feet. In some ways, states are working on discretion with assistance by offering more efficient and less obvious resources. Long gone are the days of pulling out vouchers for food stamps and WIC, many states have migrated to debit cards and soon it will be a requirement for every state to issue cards instead of old fashioned checks.
As your income raises, you might find yourself in the transition period where you make too much for government assistance but you're still struggling to make ends meet. There might still be some assistance out there, you might have to look a bit harder for it or outright ask since some sites might not overtly mention it. In Arizona, especially during the summer, electric companies such as SRP offer discounts and credit for low income households, cable companies such as COX offer discounted prices for Wi-Fi (not a necessity but helpful if you're working from home), and First Things First offers scholarships to qualifying preschool students for free or discounted tuition. Remember it never hurts to ask.
4. Save money. It can hurt to put money aside when you're just barely scrapping by but you need to. Even if it's just a little bit at a time, start building up that savings account and do your hardest to not pull from it. It's tempting, especially as the account gets a little bigger and bigger, to borrow $20 here and there. But before you know it, an emergency will come up and you won't have nearly as much as you could have.
Don't think of your savings as readily available. If it's not an emergency, no touchy! The temptation is strong when you've run out of money in your budget and want to go out with a friend, or want to take your child to the zoo. The thought "well, I could just take X amount out of my savings and then replace it" creeps up but that kind of thinking easily snowballs. I had to break myself of this habit over and over and over again so I'll say it again because I know from personal experience, don't touch the savings money!
I use the Digit app that quietly tucks money away daily from the bank account I have connected with it. It'll tuck away $1.20 here and maybe $3.00 there and I won't even notice, and it's always a happy surprise when I look to see how much I have. However, I use this app and also budget to put money away in a regular savings account as well.
5. Find a way to boost your income. It might feel like a daunting task, but really take time to see the opportunities you have to potentially raise your income. Update your resume and Linkedin account, ask friends if they know about any openings, and don't be afraid to "shop" around for new jobs. This might also mean looking into some type of training/schooling that can help open up doors for more earning potential. If you need a temporary boost in income, you can check out my list with websites and apps that might be able to put some extra cash in your hands. Just click here to have it sent to your inbox.
6. Develop a positive relationship with money. This might sound cheesy and woo woo but your outlook and thoughts about money certainly have an impact about how you use it. Know that money is a just a tool, a resource, and despite your situation now, you can obtain more of it. People have no problems remembering how money can be spent and lost, but forget it's also a tool that can also be received. If you think of money as a scarce and hard to come by it's likely you will find yourself spending recklessly and without intention out of fear of not having anymore to spend later, or you might just flat out refuse to manage your money because "I'm broke anyway". It helps to stop thinking of paying bills as "losing money”, it’s a transaction and nothing more. You might not have the $900 anymore but you do have a guarantee for a month of shelter.
Re-frame your thought process about money and start spending knowing it's just another tool at your disposal.
It's imperative we get serious about our money. Know how much you have, where it's going and become intentional about how you use it.