Divorce Law Alert - 7 Ways a Single Parent Can Stay Financially Fit
This Divorce Alert is brought to you by the Chicago Divorce and Family Law Attorneys at Aronberg Goldgehn Davis & Garmisa and Divorce Magazine. To improve its readability, this alert is a slightly modified version of the original.
By Sheri Atwood
It goes without saying that being a parent is hard. Being a single parent is harder. It’s a cliché by now that everything is expected of parents and especially single moms – we have to have it all and be it all. Except having it all and being it all is not only stressful, it can also be absolutely financially draining. Estimates for raising a child are recorded at $245,340 from infancy to adulthood.
That number sounds just a little bit daunting, doesn’t it? And then we add in the cost of a college education, and who knows what ridiculous number it ends up being. But here’s a little secret I’ve learned as a single parent: raising a child on a budget - any budget - doesn’t have to be scary. In fact, raising a child without planning on how to stay financially fit is the truly scary part.
Without proper planning, you’re going to lose money, waste money and have zero dollars left in savings. I’ve learned that one of the keys to being a responsible parent is being responsible with your finances. As a single parent, these seven tips are going to keep you – and your bank account – happy. And give you plenty of time to relax and enjoy yourself.
1. Manage Child Support
Whether you are receiving child support or paying it, be sure that this process is managed properly from beginning to end. If you are paying child support, make sure that you have a record of every payment. Otherwise, you could face late fees, or worse. If you’re receiving child support, then make sure that you are also tracking payments. Many payors fall behind, and this is a source of income you are guaranteed. In short, make sure that you are tracking and monitoring any support.
2. Take Advantage of Tax Break Incentives
As a parent, you are afforded a child deduction if your income is under $75,000, which you should absolutely be taking advantage of. If your children are in college and you’re helping them to pay tuition, then you can also take advantage of higher-education tax credits. Let’s not forget that if you are self-employed to any degree, then you should be meeting with a tax preparer to make sure you are properly tracking and recording your expenses for tax write-offs.
3. Utilize Discount Sites
Now, this does not mean that you should scour discount sites for bargains on items you don’t need. What I am recommending is to make a weekly list of items/groceries/etc needed, and then use deal sites to cut the costs of the items that you need to buy. This cuts down on wasteful online shopping, but lets you pre-plan what you will need for the week – which gets you into another good habit of forward-thinking.
4. Accrue Savings
Again, another no-brainer. But this is one of the best, and easiest, ways to start being fiscally fit. The more you do it, the easier it gets. So start setting aside a weekly amount for savings. It can be just $50 or $100. Whatever it is, start doing it the second you’re done reading this article.
5. Get Health Insurance
This is probably an obvious one, but there are still millions of Americans without health insurance. It is now cheaper and more affordable than ever, but younger parents still view the absence of paying health premiums as a way to cut down on costs. While this is true in the short run, it most always comes back to bite you in the end, and you end up spending much more than if you had been paying all along. Go and sign up if you haven’t already.
6. Work Hard at Work
Whatever it is you’re doing, do your best at it. In today’s economy, there isn’t much job security – and there hasn’t been for a long time. But the best way to ensure you’re stable is to always work your hardest. Don’t slack. Keep hustling. I learned that lesson in the tech industry, and you need to learn it too. There is no guarantee, but making yourself an invaluable employee is going to get you half-way to the goal. And be sure to keep learning new skills or traits. In short, the work is never done.
7. Automate Your Bills
This seems a little obvious, but you would be surprised at how much money people throw away on late payments fees. In total, average Americans are losing around $113 per year in fees. This is money that is completely wasted. Instead, you need to find ways to automate all your bills – car payment, credit cards, loans, child support, etc. If you automate all of them, then you will not be stuck paying unnecessary fees.
These are some of the tips I found useful as a single parent. I recommend that you follow these on your way to financial fitness, but also think of your own ways to be savvier with your finances. In parenting, and in finances, a little goes a long way.
About the Author
Sheri Atwood is founder of SupportPay by Ittavi, the first-ever automated payment platform to help parents who live apart manage child support and share child expenses. Prior to starting SupportPay, she was a successful marketing and product executive with Fortune 500 experiences. In 2009, she was named a "Top 40 Under 40 Executive in Silicon Valley." She is a child of divorce and a single mother who seeks to reduce the conflict children are exposed to when it comes to parents living apart.