For most people, maximizing their finances entails careful steps and wise decisions. However, it’s not always easy as it sounds, especially for individuals with many priorities, such as single mothers. Apart from the struggle to demand equal pay, separation can significantly affect women’s household income, regardless of the reason.
For one, divorced and widowed wives experience a 37-41% decline in their household income. In addition, their retirement pay is significantly lower compared to their male counterparts. Toss in all factors and costs of raising a child into the picture; things can quickly turn into a lifetime of stress.
Indeed, making ends meet with these circumstances can be taxing. Therefore, becoming the primary caregiver for your family’s growing needs requires you to be mindful of where to put your eggs in. But while single moms need to strive harder to reach financial stability, the good news is, there are ways to remedy this situation.
Retirement over education
Of course, the initial tendency for most single mothers is to put their child’s best interest first. But while this is true for food, shelter, health, and safety, single moms must invest in their retirement as early as now. Planning for their child’s college education will come by later on.
Regardless of your status, you can’t afford to be your children’s financial burden later on. Furthermore, approaching retirement age unprepared can cause a backlash that further complicates things for everyone. Therefore, don’t wait for your youngest child to finish their degree before you start saving for yourself.
It is crucial not to regard it as an act of selfishness. Remember, unlike college education, your retirement needs cannot be borrowed. Therefore, investing in yourself is investing in your child’s future.
With it comes planning for healthcare
Saving for your retirement goes beyond simply having to cover up your monthly bills and daily expenses. According to experts, the life expectancy for women is now significantly longer compared to men. For example, in the United States alone, figures show the average female can live to age 81, while the average male can reach 76.
However, this doesn’t make both genders prone to accidents and illnesses. And because aging usually comes with various health issues such as chronic pain, dementia, and cardiovascular diseases, you can’t rely on your strength to pay your hospital bills. Therefore, you need to sock away more than retirement plans to live a more comfortable life. Investing in healthcare is your key.
Of course, you don’t need to buy an expensive health care plan right away. There are affordable ones that can fit your budget and with your current cash flow. Make sure to get expert advice on which ones to follow and list down possible illnesses you may have based on your family’s health history. This can guide you in choosing the best health care plan available.
Establish and stick to your financial goals
As you define where to allocate your funds, ensure that you find ways to maximize what you have. So what better way to do it than making your money work for you? Depending on your risk appetite, age, and income, you can start investing for your short- and long-term goals.
For example, purchasing land for sale can yield higher returns with time, whether you decide to live in it, rent it, sell it, or resell it to residential management firms later on. You can also look for government funds or learn more about cryptocurrency, bitcoins, and other current investments that you might want to try. Of course, you can always start a business to help with your family’s growing needs.
Most importantly, create a list to know where your money goes. Then, prioritize which ones are needed and get rid of those that do not. If you’re not fond of watching TV, cancel your cable subscription. Do you have a skyrocketing electric bill? Switch to solar lights and low voltage bulbs. Even if your magazine subscription only costs $5 a month, saving $60 a year will make a huge difference in your budget. Once you weigh your expenses, know your cash flow and divide them among your savings, emergency funds, bills, investment, and what your family needs.
Providing for the family on your own is a challenging responsibility. Although it is not always easy, taking it step by step will eventually put your efforts to fruition. Moreover, it is essential to change our financial mindset to improve our economic life. Thus, instead of looking at it as deprivation, see it as an investment for a more comfortable life in the future.