March 21 is Single Parents Day – a day set aside to acknowledge and celebrate the unique achievements of mothers and fathers who do double duty in raising their families. In the United States, nearly one-third of children live with a single parent.
For single parents, the economic stakes are high. The U.S. Department of Agriculture estimates that raising a child to age 18 costs more than $230,000 – costs that can be very hard to pay on one income. As a result, single-parent households are more likely to struggle with money troubles and debt.
In honor of Single Parents Day, here are five steps to get finances in order and set a strong financial example for your children.
Live by a budget. Some people call a budget a spending plan, which might be easier for kids to understand. Whatever you name it, make sure you learn to create and learn use one. You can use software, an app, a simple spreadsheet or just a notebook. First, list all of your regular monthly expenses, such as rent or mortgage payment, utilities, car payment, and insurance payments. Then, list your monthly income, including paychecks and, as applicable, reliable child support. Subtract expenses from income. The remaining amount is what you have available to spend on variable expenses, such as groceries, clothing, savings, debt repayment and entertainment. You can set a reasonable grocery budget by looking at the USDA’s food plans for families. If you cannot make ends meet, look for ways to cut expenses or add income. Maybe you can trade babysitting or share housing with another single parent, house sit while your children are with their other parent, or watch pets for neighbors.
Help kids learn about finances. Involve your children in living on a budget, setting goals and working to achieve those goals. Teach younger ones to help with chores and manage small amounts of money from an allowance, or birthday or holiday gifts. Older kids can take jobs outside the house, such as lawn mowing, dog walking, babysitting or part-time employment. Encourage kids to set their own goals and pay some of their expenses from their earnings.
Avoid temptations to spend. Talk with your children about advertising and other pressures to spend. Ads on TV and the Internet, and in email and magazines, can give the appearance that everyone always wears new clothes, lives in a new house, drives a new car and uses the latest technology. To help reduce temptations, call or email catalogs and ask to be removed from their lists. Immediately discard or recycle advertising. Unsubscribe from promotional emails. You can skip or mute TV commercials, or even swap the TV for streaming services and borrowing DVDs or audiobooks from the library.
Do not try to purchase happiness. All parents love to see their children happy. For single parents, it can be especially difficult to avoid giving in to buying kids everything they want. Train children (and yourself) to distinguish wants from needs. One area to practice this is with restaurant meals. Everyone needs to eat, but dining out is a want, not a need. A recent analysis of home cooking and restaurant prices found that eating out costs about $9 more per meal than eating at home. Over the course of a month, a family of three would save $325 by eating at home instead of eating at restaurants three times a week. Clothing is another area where you can focus on wants vs. needs. Owning smaller wardrobes – and buying non-brand clothes, purchasing on sale, or shopping at thrift stores – can save hundreds of dollars.
Save instead of borrowing. Before borrowing, remember the long-term cost of owing money. Getting out of debt is never easy. The best way to avoid the pain of paying off debt is to avoid it in the first place. Instead, work hard to save and build an emergency fund. Then, when unexpected costs come up, you do not need to turn to a credit card.
Finances can be stressful for everyone, but single parents often face unique challenges. Always remember that your kids need you, not money, first and foremost. Spend wisely, do your best and plan for a rainy day. Above all, talk with your children about why you make the decisions you do. Your thoughtful guidance will give them the opportunity to build a solid financial future.