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How to Budget As a Single Parent

If you ask several of your friend’s what their greatest joy in life is, their answer could very likely be their children. When people decide to have children, their lives are changed forever.

Most people picture themselves getting married eventually and settling down to have children. What people don’t anticipate is separation or divorce.

Sometimes separation or divorce is inevitable. In these cases, it can be difficult to decide who should have custody of which children.

Because of divorce, many parents are forced into being single parents. While this is difficult, most parents are happy about and willing to take care of and raise their children even if they must do it on their own.
Many people know that raising children on their own is harder than raising them with two people, yet they still buckle down and do the best they can because they love their children. Being a single parent obviously has many challenges.

One of the biggest challenges of being a single parent can be learning how to budget. You now must support your family with only one income coming into the home.

While it may seem impossible, nearly 13 million American parents do it every day. They learn what they need to do to budget, and they make it work.

What do single parents need to do to budget? Here are a few tips on how they can get started.

First, Assess Your Finances

The first thing you should do is take a look at the status of your current finances. It’s unfortunate but divorce is not cheap, especially if it took a long time to reach an agreement. Once the divorce is final you’ll most likely be left with a considerable amount of legal debt as well as typically couples are expected to split any liabilities such as the mortgage, car payments and any other long term or even short term loan liabilities from installment loans, cash advances etc…

Next, Adjust Your Budget

Once current liabilities have been assessed every single parent should sit down and re-adjust their budget. They need to look at their fixed costs, variable costs, and one-time annual costs, and try to compare these costs with how much money they think they will make within the year.

Some examples of fixed costs are bills that arrive at your door every month. Monthly costs could include bills for TV, cable, internet, insurance, and utilities.

Although no one really likes to pay these kinds of bills, they are necessary to pay if you want to have a permanent residence. These are costs that you usually cannot cut out of your budget.

Then you have your variable costs. Variable costs are costs that are not as fixed as a monthly bill.

Check Your Variable and One-Time Annual Costs

Variable costs vary between people and families, but they could include clothing, groceries, money spent on eating out, traveling, vacations, etc. Families will spend different amounts of money on different things, so your family’s specific budget will be customized to your family.

One-time annual costs can include but are not limited to real-estate taxes, income tax, Christmas presents, registration renewals, and other payments that are made once a year. When one parent is newly single, usually they start looking for ways that they can trim down the amount of money they spend each month and each year.

In general, the area that you’re probably going to be able to cut back on the most is the variable cost category. As discussed earlier, fixed costs are usually costs that cannot be eliminated from your budget.
You may be able to pay less on your fixed costs, but you will most likely not be able to get rid of any of them. Variable costs are where you are going to be able to do the most trimming.

If you were able to spend a lot of money on clothing before you separated from your partner, you may not be able to spend as much money on clothing if you are now a single parent. Additionally, as a new single parent, you may have to pay for things that you are not used to paying for.

These things are most likely going to be related to your children and the care of your children, like daycare, childcare, transportation for your children, or education. Another issue that single parents must face is that they may simply just not make enough money to be able to support their family anymore.

Many single parents face a difficult decision when they reach this point. It can be difficult to just quit their current job and try to find a new job in this economy.

Because of this, many parents decide to go back to school and get a higher degree so that they can secure a higher paying job. Before a single parent makes this decision, they should carefully consider what they really want to do.

Going back to school could cause much financial strain on the family. Single parents should make decisions about their financial situation with the best interests of their children in mind.

How to Teach Your Children How to Budget

Parents have an incredible amount of influence on their children. From what clothes they wear to what foods they eat to what religion they choose, children generally follow the example that their parents set for them.

When it comes to budgeting, there are quite a few wrong ways to do it. Many parents are flippant about money in front of their children, and that sends a certain message to the youngsters.

Many other parents simply do not address the issue of money and managing money to their children at all, just hoping that their kids will “catch on” and figure it out for themselves. It would seem obvious that this is not a great idea.

Teach Your Kids How to Budget Early On

Neglecting to sit down with your children and talk to them about money and budgeting would be a serious mistake. If you don’t teach your kids about budgeting, who knows what financial mistakes they could make in the future?

Teaching your children now will help to prevent them from making the kind of financial mistakes that are very hard to undo later on down the road. Kids need a gentle but firm example of how to approach and manage money from loving and kind parents who want to help, teach, and guide them.

One of the most important things parents can do is to teach by example. Parents cannot expect children to live by certain financial principles if the parents aren’t willing to abide by these principles themselves. If a child sees their parent using their credit cards, second mortgage or a cash advance irresponsibly then they will be more likely to make the same mistakes when they grow up. While each of these can be great financial tools when used correctly, it takes the proper discipline to ensure that they’re paid off in a timely manner.

Begin With a Budget Sheet

Begin by showing your children your budget sheet, and how it all works. Show them what each column means and what expenses go under which column.

During your teaching moments with your children about money, be sure to be calm and patient with them at all times. No matter what age your children are at, it is important that they know that they are able to learn in a safe and inviting environment.

Make sure that they are not afraid to ask questions, or of looking dumb by asking a question. Make sure they know that asking questions is good and is a way to learn, and by no means mean that they are inferior.

Make Budgeting a Family Activity

It can also be a fun family activity to take a trip to the bank and talk about what happens there. It is up to your discretion as a parent as to how much information or how much detail you want to go into at the bank, but it could be a fun and exciting learning experience for your children.

Whatever you might be doing at the bank, like cashing a check or putting money into your savings account, make sure you talk to your children in specifics about what it is you’re doing. This will help them feel included and like they’re more a part of what is going on.

Banks often have balloons and candy for youngsters who are in the bank for their parents, so these types of things can help your children feel comfortable inside the bank and associate it with positive emotions.

Teach The Basics, Like How to Buy Groceries

One of your next stops after the bank can be the grocery store. Show your kids your grocery list and explain to them that you always bring a list to the store with the items that you need; otherwise it is likely that you will buy more than you intended and stray outside your designated budget for food that month.

Have your kids participate in going around each aisle and selecting the items that are on the list. Explain to them that there are different brands of each item and that certain prices are better than others.

Have them look at the unit prices on the tags under each item and teach them that that is where you can see how much you’re paying for a certain amount of an item. Explain to them that you want to get the most product for the cheapest price.
Bring a calculator to the grocery store and have your kids add up each item that they put in the cart. This can help them visualize and understand the concept of staying within a certain budget.

If they’re adding up the items in the cart and the total goes over the amount that you had set aside for groceries, explain to them that sometimes you have to make sacrifices if you can’t afford everything you wanted. Help them put certain things back on the shelf that aren’t absolutely essential.

A helpful learning activity that can go along with grocery shopping is helping your children look for coupons in newspapers and magazines before you shop. Explain to them that not all coupons are useful; only if you were going to buy that item already before you saw the coupon will the deal save you money.

Teaching your children how to budget and to interact with money in a healthy way is one of the greatest gifts you can give to them as a parent. They will have much more success with their finances in the future because of your diligent efforts to help them in this area.

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