Managing your finances as a single parent

By Abel Kabiru

Being a single parent can be challenging, especially in these hard economic times — the children rely solely on you to cater to all their needs. Sometimes this can be overwhelming if your finances are not in order, or your income is limited. But regardless of how much money you earn, you can provide for yourself and children within reasonable means. There are some critical factors that could guide you to financial sustainability and eventual independence.

Stable income

You need to ensure you have a stable income. It does not matter how much money you make. Try to meet at least the basic needs of the house and family.

I have witnessed single parents give in to the allure of ‘making more money in business’ and quitting their jobs with regrettable consequences. If you are employed, stick with your job. You should only move into business when the prospects of the success of a business are assured, you have kept aside enough money to last you about six months and have drastically reduced your liabilities.

Emergency funds

Even while in employment, allocate a portion of your earnings to savings and emergency funds. These will come in handy should anything unpleasant happen to you. When both spouses are present, there is always the fallback plan of the other partner. But as a single parent, you have nobody to fall back to. So it is paramount that you plan yourself, your incomes, expenditures and savings.

Prioritise

Prioritisation will be an integral part of your planning. You have to be judicious on how you spend your money and not fall for the whims and tantrums of your children. Live within your means. If you are operating on a restricted budget, let the children know that they cannot have everything they desire or the lifestyle of some of their friends.

Do not overreach yourself

A single parent may want to be everything to the children. This may strain your finances irreparably. Buying presents everyday and eating out is okay if you have a lot of money. However, consider saving for the future if your income is not secure.

Be consistent

Consistency for a single parent is the most important attribute. Let the children have consistency in terms of provision and time spent together. Knowing that mum or dad will provide, eases a considerable amount of stress on the children as they grow and become aware of your single-parent status. Try everything within your power to assure them that things such as food, rent and school fees are covered.

You would rather live a standard but assured and consistent life with your children instead of experiencing the highs and lows of living beyond your means.

Insurance

Insurance also plays a crucial role for most single parents. Medical and education policies are strongly recommended. Ensure that you can afford the premiums comfortably. Most policies are upgradeable should your finances improve.

Do not base your plans and financial projections on a spouse you are yet to meet. Don’t fail to start saving for a child’s education because you hope to be married in, say, five years, upon which you hope the spouse will take up the responsibility.

In addition to saving, create a back up for your income. See if you can start a small side business that can run in your absence. It could even be a micro-business manned by your house help instead of letting her watch TV the whole day. The amount of money you have at your disposal will determine the type and size of your side business. The proceeds can take care of recurrent or development expenditure.

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