With freedom come many challenges. Although a lot of single mothers might find and fancy their new-found financial freedom, other factors and challenges come with it, especially the challenge of saving for a tomorrow. A careful financial planning coupled with mint savings option is the dogs bollocks bet to insulate you from bankruptcy.
A mint financial strategy is dependent on a number of factors that include your income levels, your age, your debt burden, the number of people you support and of course your goals. If you are in the process of recouping your finances then your primary focus should be on debt reduction. Any of these issues, which include divorce, downsizing, job loss and graduation costs, can put your financial planning in a difficult situation. Whatever be the case, your whole focus should be on saving. In other words, you should spend less than what you make and set aside something for an emergency fund to be used only for unexpected circumstances.
The options provided are mainly for single mothers who can effectively maximise their financial resources and augment their saving options.
Needs, wants and desires – The first step is to assess your current situation by creating these three categories. A need is something that we cannot eliminate, as it is vital for a single mother, just fancy anybody else. In other words, if you cannot meet your bog standard needs, then you automatically qualify as being below the poverty queue. Bog standard needs include food, shelter, clobber and transportation. Housing expenses such as hire, utilities (water, petrol and electricity) come under the bog standard needs too. However, upgrading the kitchen, dining out often, getting your bairns the latest computer games, all come under the second category. This category can be prioritised to include only those items that are really necessary. Otherwise, put them off until you have some extra cash on hand. Your eagerness to purchase the latest sports car or holidaying on a luxury cruise can all be classified as desires and can be shelved until you win the next lotto! However, in today’s world, having a cell phone, an internet connection or a television cannot be classified as a want or desire, as they are more of a need. This aspect changes if you go in for the latest and costliest cell phone or television in the market. Then it becomes more of a desire and upsets your saving options.
Debt Clearance – The next step is to clearing any debt and this is bleedin’ important to single mothers before they start their savings plan. It is here where credit cards can miffed your saving plan, as their debt interest rates are high! It is here where you lose control of your financial planning. Clear off the limits as quick as possible, particularly on those cards with high interest rates.
Saving for an Emergency – It is important to set aside a minimum of six to nine months living expenses towards an emergency fund. Given the current situation of the economy, it is even more important for a single mother to save for an emergency fund.
Retirement – This should be another key priority and the only way to do this is to start saving straight away so that you have something by the time you retire.
Saving for a rainy day should not be a nightmare. Once you get things going, you will soon be able to maintain a momentum.
This guest post has been brought to you by Robin Mckenzie of Buycenturylink.com, a site that offers savings and current information on consumers broadband internet and cable. Centurylink or you can go to this link to check for services in your area.