May 27, 2021
Life as a single parent is full of responsibilities for young children. You need to provide emotional, physical and financial support with limited resources. The emotional and physical support is somewhat in your hand, but you may not have a firm grip over the finances.
Thus, you need to control the budget to ensure the future remains financially stable for the family. Many single parents lose sight of their personal financial goals to raise their kids. Similar to this, there are common problems you may face in the absence of a plan.
Here are some tips for single parents to create a budget and manage the finances for their family.
1. Prioritise Expenses of Both, You and Children
The importance of priority spending increases if the budget is tight. You need to create a list of expenses with a priority rating in front. This list should include the costs of you and your children to create the perfect budget.
You don’t have to keep your expenses on posteriority to cover every expense of the kids. The new single parents often forget to ignore the essential costs such as healthcare or travelling cost. It may take some time to create the proper budget. Until then, you can manage the expenses with payday loans in Ireland.
2. Build an Emergency Fund
An emergency fund will help you and your family to sail through difficult times. Kids often cause sudden financial trouble because of some minor accident or school trips. Therefore, you must have an emergency fund to deal with unexpected situations.
You can start saving with the 80/20 method to set an emergency fund. People use 20% of their income to build the emergency fund along with the surplus from the other portion. You can stop once the account can cover 3 months of your expenses with no income.
3. Find Fun Activities in Budget
Families require some time to enjoy together with some fun activities. You may find the movies or amusement parks unaffordable because of the tight budget. Still, there are many activities a family can enjoy within a limited budget.
You can cook delicious food at home and watch movies or play board games together. The kids will also appreciate visits to parks and some fun activities there. Or, you can take them for long drives and picnics with homemade food to save money on overpriced restaurants.
4. Set Long-Term Goals
Long-term goals can act as motivation to save money and continue the budgeting efforts. These goals bring value to your life and build some asset to rely on during a crisis. However, we often ignore them because of the additional responsibilities.
Instead, you should create financial goals keeping in mind the future of yourself and the family. You will need a house or retirement fund to live on after retirement. For the kids, they will require assistance with the college education and wedding in future.
You should not use the money saved for these goals to manage the current financial troubles. Many people lose the motivation to save once the fund is used for some other expense. For emergencies, you can apply for personal loans in Ireland for bad credit from direct lenders.
5. Automate the Transactions
Different payments and saving goals can create chaos in money management. The simple solution to manage multiple transactions is automation. The banks will automatically transfer money to your savings account, debt repayment, and bill payments to reduce the chance of unnecessary spending.
6. Go Frugal
You can adopt a frugal lifestyle to save money with the cost-efficient alternative to every purchase. Do not confuse frugal living with cheap since the term is often misunderstood. Frugal people will spend money on the necessary items if it brings value to their life.
They will not spend hours in the line to save a few bucks as time is more critical. Moreover, you can expect them to spend more money on items if it brings more value in terms of features, durability, or comfort. They will buy a poor-quality product only to spend more money in the long term for the cheap people.
7. Increase Income
You can always find an additional stream of income to manage the expenses. Though, a side hustle may reduce family time and hurt the work-life balance. Nevertheless, it is time to invest the additional hours after the 9-5 jobs if the cost-cutting is not working.
You can also add new skills to your profile to get a raise. Many professionals have increased their income twofold within a year by working on their key skills. You can also move to a new company for a better role and paycheque.
To sum up, finances are a tough subject for the new single parents if the expenses are beyond the budget. It will take consistent efforts for a few months to get the finances under grasp. Nevertheless, it is essential to focus on the need of yourself as well as the kid while trying to reduce unnecessary expenses.