Get a Grip on Single Parent Finances Now

If you’ve recently become a single parent due to divorce or the death of a spouse, here’s the basics of what you need to know and do to secure your financial health now and in the future.

Your Best First Action may be Inaction

Emotions, such as shock, anger, sadness, denial and grief can affect your ability to make good decisions about your best long-term financial interests. Give yourself six months to a year to work through your feelings before you begin making major financial decisions.  If you need to make financial decisions sooner, enlist a trusted family member to help you make clear headed decisions.  Hire a reputable financial advisor to help you make sound decisions.

Dealing with Large Sums of Money

If you’ve inherited a large sum of money, for example a life insurance policy death benefit, talk with a financial advisor about the best place to deposit those dollars over the short term to give yourself time to process your new situation.

Make Sure that Short Term Responsibilities are Taken Care of

Although you may feel overwhelmed by your current situation, it’s important that you take care of your current basic monthly financial obligations.  You don’t want to ruin a good credit rating:

• Close joint banking accounts and credit cards and, when appropriate, open new ones in your name.
• Stay up to date on your bills. If you aren’t already signed up for auto pay, now is a good time to start.
• Update your beneficiary designations and contact information on your financial and legal documents.

Dealing with Financial Hardship

If you all of a sudden find yourself financially strapped, look for opportunities to live on less. Look at your monthly expenses and see what you can live without.  Many of our expenses seem like necessities, but they really aren’t.  The following expenses can be cut until your financial situation improves:

• Bundled cable, land line phone, and WIFI services.  You really only need the WIFI.
• Movie, magazine and newspaper subscriptions.  Rent a movie from Red Box on occasion instead.
• Take a hard look at your cell phone package and see if you can cut some of the cost.
• Hairdressers, masseuses, nail salons are all non-essential.  We learned this from the pandemic.

Moving into Your New Normal

As hard as it may be to find yourself as a new single parent, you will adapt and find your balance in time.  But until then know that there will be adjustments along the way.  And if you have financial questions consult a financial professional. He or she can help you establish a financial strategy to help meet your needs now and for the future.