Being a single mother is tough enough without having to worry about the financial aspects of raising children alone. Even if there is child support involved, it may come in very inconsistently, and at times, not at all. Having an outside full-time job is very hard for a single mother to have to deal with on top of the full-time job of raising her children, however in most cases is a necessity. So how is it possible to create a financial plan on a limited income and without another person to help share this overwhelming burden? The answer is simple, it always is: babysteps.
Trying to establish a concrete financial plan as a single mother is like trying to climb a mountain barefoot. Many single mothers may not know where to begin. Many people believe that creating a budget is the first place to start, but this not true. The first step to creating a financial plan is to track your spending. Ideally this should take place over a period of 1-3 months. Don’t forget to include emergency expenses and quarterly (flat tire, unexpected trip to the dentist) or yearly expenses (car registration, oil change). If there is not time to do this move on to the next step, but incorporate this step with it. Do both steps simultaneously and adjust your budget according to you spending tracker.
The next step is to create a working budget. This can be hard because there is so much uncertainty in life: car repairs, medical bills, presents for a friend’s child’s birthday party. The list is nearly infinite. The trick is to have some leeway in the budget. Over estimate all expenses rather than underestimate them. Don’t forget mundane, forgettable expenses such as trips to Starbucks or lunch money. It all adds up in the end.
Once you have created a budget (a program as simple as Excel can work, but many websites such as Mint.com work well too) analyze how much money you should have left at the end of the month. When you get paid, put that money away into a savings account or keep the cash tucked away, in a safe place, at home. Try out your new budget and try not to dip into your savings fund. If all goes well, you should have that extra money left over for an unexpected or special expense later on. Add to that any money that you have left over from your budget (remember you should have overestimated your expenses). If you are coming up short, you need to see where the problem is (checking your spending tracker) and fix that problem. If you need to, cut back on purchases or bills that you don’t need (cable or home telephone service).
Once your budget is working, you are all set. Just stick to it and you should have plenty of money to pay those yearly expenses (birthday and Christmas presents for example). If you are still having trouble, try looking for a job closer to home or see about increasing your child support income. Child support can often be adjusted as children get older and their expenses increase.