The biggest fear of many newly-single parents is finances, especially if you were not the breadwinner in your marriage.
Single mom money saving tips:
Financing kids without your higher-earning spouse can be a rather scary feeling. But don’t worry, below are some easy single mum money saving tips so you can secure your child and your future.
1. Believe in yourself
This is the most essential single mum money saving tip that any one can give you. Being a single parent can be daunting, especially if you were not prepared or expecting to be in the situation you are in today. Finances can cause a whole lot of stress and this feeling will eventually trickle down to your kids. Believe you can do it, then make a plan to achieve whatever it is you are aiming for.
2. Insurance policies
Invest in long-term insurance policies. You can pay a lump sum per month for the first five to ten years and then let the policy mature. This will help you with your child’s college fund, marriage fund, or even property down payment. Such policies can be bought from large banks like HSBC and smaller insurance companies such as AIA or AXA Life Insurance.
3. Invest in a property
Start with a studio apartment or one-bedroom property, either on your own or with a family member. If you live in Singapore, get a HDB flat. With the current market situation, property investment in Asia seems to be the way to go. This way you are securing yourself and your child with a roof over your head, and the potential to use that liquid money when needed, toward your next, bigger investment.
4. Piggy bank: Separate your child’s money
Having a small piggy bank at home as a way of putting money aside is a great way to save for those times when you suddenly need a few hundred bucks. Having a separate piggy bank for your child’s money is helpful as well. For example, you can set aside the money your child receives in red packets during Chinese New Year or Diwali. Then you can save up to buy something bigger for your child in the future or even for your next holiday.
5. Create a spreadsheet of your incomings, outgoings and expenses
This is essential when parenting single-handedly. If you have a spreadsheet outlining all of the above, you will clearly be able to see in black and white where your money is going and know where to make cutbacks, if needed.
6. Forecast your expenses going forward
Having a spreadsheet outlining your finances will also enable you to forecast your dreams and hopes of purchasing bigger things going forward, such as a nicer house or even enrolling your child in a better school. When you see numbers in black and white and formulas in place predicting figures for your future, you will feel a lot more relaxed and confident knowing your dreams are achievable within a time frame.
7. Save money in two bank accounts
After paying the essentials (mortgage/rent, utilities, bills, groceries, etc.), put aside what’s left into two bank accounts:
- 70% into long-term savings (for bigger token items such as a house, car, etc)
- 30% into short-term savings (for things like holidays and small splurges like a new household item)
8. Pay your bills on time
Paying off credit card bills is a huge pain in the butt, but once it’s cleared month to month that feeling of relief is irreplaceable. Having debt cleared monthly will enable you to use your disposable income wisely and give you a whole lot less tension over debts.
9. Set financial goals
The question always is: What do you want to achieve out of life, financially? Do you want to secure yourself and your child with properties and/or a successful business? Whatever it is you would like to achieve, you should set financial goals. With careful planning and hard work, anything is achievable, even as a single parent.
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