A Woman’s Guide to Investing–Part II

She plans to reallocate her positions when she meets with a TIAA-CREF investment adviser.

Help Yourself First
With limited resources, single mothers might be tempted to skimp on their retirement savings in favor of helping their children. “Women, often to their detriment, end up worrying about their kids first and then they think about their own retirement,” says Hounsell. That’s a mistake. “Your children can get a scholarship or a grant,” says Jennifer Basye Sander, author of The Complete Idiot’s Guide to Investing for Women (Alpha; $19.95). “But you cannot get a scholarship for retirement.”

That’s what Hoyte thinks too. While she intends for her children to get the best education they can, retirement comes first. “Hopefully my children will be able to go to a college or university that’s inexpensive, or one where they’ll get significant financial aid,” says Hoyte. “I think it’s better to hope for that to happen while saving for my retirement than to save money for their college and then have my children burdened with trying to help me out financially when I’m old.” Hoyte adds, “If there’s any gift I can give them, it’s that their mother is self-sufficient.”

Protect Them
As the sole breadwinner, single mothers can be vulnerable if the unexpected happens. They need to figure out how their children will be supported if they become disabled or die. “You need to protect your children’s well-being with disability insurance and life insurance,” says Hounsell. Term life insurance policies have come down dramatically in cost in recent years. A 40-year-old woman can buy a policy with a $500,000 death benefit for 20 years for $330 a year. Remember, too, that as a single mother, you’ll need to think about estate planning. You’ll want to name a guardian for your children should something happen to you. In addition, you need to decide how your assets will be used for their care.

Cash is King
A cash reserve is important at every stage of life, but for single mothers it can be vital. It’s not just you who needs a safety net, but your whole family. “A cash reserve is crucial before you start to invest in a big way,” says Charlotte Stallings, a personal finance expert in Houston. You never know when your child might injure himself and you’ll have whopping medical bills, or if you lose your job and ballet class tuition is due. “You need eight to 10 months of savings,” says Barbara Stanny. That’s more than the amount experts recommend to singles without children and couples.

MARRIED

Felicia Miller, 39, was instilled with a sense of fiscal responsibility as a young child. She was given an allowance, but only a third was to be spent, the rest went toward tithing and savings. While she attended the University of Pennsylvania, her mother paid for tuition and housing, “but she said I would have to feed myself,” says Miller, now a professor of marketing at Marquette University in Milwaukee.

Miller carried this financial attitude with her

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