With 11.7 million single parents in the U.S., that's a lot of people trying to manage a family on their own. Single parents face many financial challenges that many dual-parent households don't even have to consider.
Samantha Fraelich, certified financial planner professional and vice president of Bernard R. Wolfe & Associates, Inc., offers these financial tips for every single parent.
It’s a good idea for everyone to budget their money and expenses, but this is especially true for those who are single parents. Create a realistic budget and discuss it openly with the children so they understand why they can’t get money for everything they want.
This may seem obvious, but there are a variety of things that single parents need to save for, such as retirement, an emergency fund and their child’s college education. Many parents don’t know which goal to save up for first, so after talking with an advisor, automatically saving a small portion each month can come in handy and add up over time.
It is crucial that single parents have the right insurance policies in place. The two most important types are life insurance, so that there is financial support for the care of their children if something happens to them, and disability insurance, in case something happens and they are unable to work.
Estate planning is a task that many people want to put off or not think about at all, but it’s critical to make sure that single parents have created a will detailing exactly what should be done for the children if something happens to them. A power of attorney and medical directive are important as well.
It can be helpful for a single parent to seek out the services of a professional financial planner to help them get all their financial plans in order. A planner will be able to help determine what is needed and give you options on how to allocate funds that can help make it happen. They can help create a road map that a single parent striving for financial success can follow.