The Single Life: Money Basics for Parents Raising Kids Alone


Managing household finances can be difficult for parents carrying the responsibility alone. Whether it’s a baby requiring diapers, formula, and frequent doctor visits or a teen who’s part of the back-to-school population and into top-of-the-line (aka expensive) technology, affording the basics can be an overwhelming challenge for single parents in a tight economy.

Carla Cargle, financial adviser and founder of Genesis One Wealth Builders in Sugar Land, Texas, offers these money management basics to single parents trying to properly manage their finances:

  • Make and follow a sound budget or spending plan. Honestly examine your spending patterns, expenses, and income and be diligent with a plan of action for managing your money. “They need to have a household budget that they follow to make sure all the essentials are taken care of first and foremost,” Cargle says.

Don’t know where to start? Cargle recommends tracking the way you spend your money for at least two weeks and categorizing the expenses (e.g., food, clothes, movies). Then decide on the best spending plan for your income and identify where you can make adjustments. Put necessities first, then incorporate any extras.

  • Get the right insurance coverage. This includes having proper health and life insurance coverage for yourself and your children. If you’re a homeowner or renter, invest in insurance to cover unexpected expenses or loss. “You never know what could occur so you should be prepared for anything,” says Cargle.
  • Have an emergency fund set aside, separate from your usual savings account. With the advent of savings accounts serving as overdraft protection, having a separate account just for emergencies is a good idea. Look into opening a money market account where the funds aren’t as easily accessible.  “If it’s outside of your immediate access then you are less likely to tap into it,” she says. There are several money markets that don’t have minimum balance requirements. But if you’re interested in one that does, “start a savings account at your bank or credit union and then transfer that money into the money market account when you’re ready,” suggests Cargle.
  • Learn to say no to your children when it comes to spending. Oftentimes, 0verspending and not saying no to extras can contribute to parental debt. Don’t overindulge, put an allowance in place, and stick to your budget, Cargle says. “At some point, the child has to learn these things so that they can become responsible with money as adults.”

  • Start a savings plan for your children’s future. In addition to looking into options such as the 529 College Saving Plan, flexible spending account (FSA) or Uniform Gift to Minors Act (UGMA) account, start looking into scholarships, grants, and other ways to fund education early. “Don’t wait until a child is a senior in high school before you start saving for college or educational pursuits,” Cargle says. Determine your child’s aptitudes, develop a portfolio of information on how to nurture them, and find ways to start saving to support their development.


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