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financial advice for new single mothers

9 Pieces of Important Financial Advice For New Single Mothers

financial advice for new single mothers

 

Life is different now. You have recently been through a divorce and are now the single head of a household, which is a huge personal – and financial – responsibility. While you may still be doing many of the same things as before, you now are 100 percent responsible. There is no one to share the myriad responsibilities and decision-making.

This may be all new to you. It is also likely that you are still riding an emotional rollercoaster. Now is a good time to step back and take a deep breath. While many financial challenges lie ahead, understand that you can do this.

Financial Advice For New Single Mothers

What do single mothers have to do differently financially? To achieve financial success, newly single mothers should heed the following advice.

Just say no to credit card debt

Don’t live beyond your means and rack up high-interest credit card debt. This is one of the worst debts to have due to high-interest rates. Credit card debt should be paid off first when prioritizing bills.

Prioritize what is most important.

Take a moment (or longer) to assess your new financial life. Your family needs you to clearly understand how you can make everything work, without sacrificing too many of “the good times.” Review your lifestyle and analyze what changes and/or adaptations need to be made. Prioritize and differentiate between your needs and wants, and those of your family. Make notes. Create lists. Write things down.

Ultimately, let this “prioritization” process guide your budget. Focus on just a few practical lifestyle/financial priorities and learn to make concessions with others.

Get real with what you can afford.

Create a realistic budget. Track your spending over a specific time to see where your money goes. The goal is not to set up an austerity program that is so severe that everyone is unhappy; rather you just need to accurately understand your spending habits so you can manage and track your flow of money in an honest manner. For example, if yoga makes you happy and less stressed overall, look a reasonably-priced studio in your area or do an at-home workout.

Not spending money on yourself (within reason) can be detrimental in the long run. It is fine to put some of the focus on you. Every mom has been told that she needs to take care of herself first, so she has the energy and resources to take care of others. This applies to finances too.

Don’t try to keep up with everyone else.

Even if your lifestyle had been different previously, now is not the time to try to keep up with your neighbors and friends. As we said earlier, your life is different now. The financial decisions you make going forward will be based on a different set of circumstances.

For example, prioritize making mortgage payments and saving for (or taking) one annual family vacation, rather than putting yourself into debt to drive a more expensive car.  Even if it seems that’s what everyone else is doing, prioritizing driving the Mercedes instead of keeping up with your everyday bills will only hurt you in the long run.

Manage risk smartly.

Having only one income means it is just that much more important to protect. Obtain life and disability insurance to protect you and your family in the event the unforeseen should happen … because it can. Unfortunately, I have worked with clients who depended exclusively on one income and that person became sick and was out of work for several months.

It was both unfortunate and sad. Purchasing a cost-effective disability policy is a prudent way to safeguard against a potential loss of income.

Develop a plan B.

Planning for the future is an important component of ongoing financial awareness. Many people have asked me what is necessary for an estate plan when you have young children. At the very least set up a will. Should something happen to you, you want to have a say in who will care for your kids and where your assets will go. You do not want to be in a situation where the state determines who the guardian of your children should be – what if that is not aligned with your intent? Get it in writing.

A full estate plan is recommended (including health care proxy and power of attorney), but creating a will is a good, productive first step.

Pay yourself first.

With only one income, it may seem harder to save for retirement, especially if you envision having college educations to pay for, but it is critical to do so. Children can receive financial aid, scholarships, and loans to help pay for school, but those alternatives do not exist for retirement. Put away as much as you can into your retirement savings on a pre-tax basis and make sure to contribute at least as much as your employer matches (it’s free money!).

Don’t try to do everything on your own.

Not having a knowledgeable team of resources on your side can be the biggest disservice possible to yourself. A smart parent – especially a single parent – is aware of what they don’t know and asks for help when she needs it. This includes seeking help with your finances. Work with an advisor who places your interests first to help you make sense of the various aspects of your financial life and empower you to become educated on these topics.

Get referrals for accountants, estate planners, etc., from trusted friends or colleagues who you know have been in a similar situation to what you are facing. Building a support system will make managing finances as a single parent much less overwhelming.

Proactive Approach

Taking a realistic, proactive financial approach as a single mother is essential to your well-being and that of your family. Following the advice in this article can help you avoid unnecessary anxiety and keep your financial options open as a single parent.

The post 9 Pieces of Important Financial Advice For New Single Mothers appeared first on Divorced Moms.

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Why It

Why It’s Important To Put Children First During Divorce

Why It's Important To Put Children First During Divorce

 

I’m not one of those experts who believe that divorce has little significant effect on a child’s life. I’m of the opinion that divorce can set a child up for lifelong emotional struggles. The divorce of a child’s parent leaves them with negative emotions they will deal with throughout their lives in one way or another.

Yes, they learn to adjust to the fact that their parents are divorced but, the sadness caused by the divorce lessens with time but never goes away. On top of the regret, a child feels over a parent’s divorce there can be devastating consequences if the parents do not handle the divorce in a responsible manner.

I bristle when I hear parents say that children are “resilient” and can “handle” their divorce. I’ve talked to adults who were devastated years after their divorce was finalized, yet for some strange reason they believe that their children are more capable of getting over and learning to live with a situation they, themselves are finding hard to accept and move on from.

It is this belief by parents that children resilient that sets children up for disaster when their parents’ divorce. A child’s divorce experience is shaped by whether or not parents continue to put their children’s well-being and security first during the divorce process.

Why it’s Important to Put Children First During Divorce

Divorce means huge changes in the lives of children. It can also mean direct involvement in conflict between parents, changes in where they live, economic hardship, broken bonds with a parent, loss of emotional security and a multitude of emotional stressors.

Divorce means the loss of a child’s family, something that is the center of their universe. If a child is raised in a happy or low conflict family, that family is the base of their security. It is what allows that child to go out into the world and broaden their horizons because they know there is a safe place to return to.

The loss of an intact family is like a death to the child. There will be a period of grieving and a need to replace, with something new the security they had in the intact family.

Divorce increases a child’s risk of psychological, educational and sociological problems. A parent’s divorce touches every aspect of a child’s life. A child’s relationships with friends will change and their ability to focus and concentrate in school will be affected. As a result, there is an increased possibility of problems with anxiety and depression.

Divorce causes children emotional pain. Regardless of how hard a parent tries and how well they parent, a child will feel sadness and loss during and after a divorce. Your divorce is going to hurt your children! And please, don’t fall for the nonsense belief that if the “parent is happy, the child will be happy.” I promise you unless your child is witnessing or a party to domestic abuse or high conflict the child could care less if Mom and Dad are happy.

Some parents have a misguided belief that their children are spending time and energy worrying about their happiness. Nothing could be further from the truth, children are concerned with their own happiness and security, as it should be.

So, please, don’t project your need to divorce so you can be “happy” off on to your children. You will do them no favor and it will free you up to ignore their pain due to a skewed belief that is not correct.

What Are The Negative Effects of Divorce For Children?

If you contrast children from intact families to children of divorce, children from divorced families are:

  • Twice as likely to have to see a mental health provider,
  • Twice as likely to exhibit behavioral problems,
  • More than twice as likely to have problems with depression and mood disorders,
  • Twice as likely to drop out of high school before graduating,
  • Twice as likely to divorce themselves as adults,
  • Less socially competent and tend to linger in adolescents before moving into adulthood.

Andrew Cherlin, a family demographer at Johns Hopkins University, said that even those who grow up to be very successful as adults carry “the residual trauma of their parents’ breakup.”

In other words, when we, as adults make the decision to divorce we are going against our natural parental instincts…protecting our children from harm. Some would argue that divorce in and of itself does not cause harm to children. They believe that it is the behavior of the parents during a divorce that determines how a child will fare or what the consequences will be.

I agree that as parents we can lessen the negative effects of divorce on our children. There are obligations that parents have during divorce that can help our children cope. The issue I have though is this, during my career as a therapist who has worked closely with divorcing clients children seem to take a backseat to their parent’s needs during that time.

Parents are more focused on the legal process of divorce and their own emotional needs than their children’s needs. Until I see a change in the way the majority of parents behave during a divorce I will hold onto my belief that children are irreparably harmed by divorce and suffer due to parents who are unable to parent and divorce at the same time.

The post Why It’s Important To Put Children First During Divorce appeared first on Divorced Moms.

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