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5 Money Moves Single Parents Should Make

November 11, 2020

In a two-parent household, raising children can be quite the task. Raising children as a single parent brings additional challenges, stressors, and responsibilities - many of which are financial.

Though financially stressful, it’s important to remember that it’s possible to raise a child on your own and have a stable financial life. It merely requires discipline and planning. So, if you’re a single parent and feeling a bit overwhelmed, use these steps as a guide to help you achieve financial security.

  1. Prepare Your Estate Planning Documents

It’s hard to think about, but nobody knows for sure what the future holds or how much time we have left. So, unless you feel confident in leaving your personal and financial decisions to those you leave behind or to state officials, it’s essential to make time to sit down with an attorney to discuss your wishes should anything unexpected happen. People tend to procrastinate when it comes to getting their estate paperwork in place, but it’s important to be proactive so you can be sure that your wishes will be followed when you’re gone, especially about who will raise your children in your absence.

Since children under the age of 18 cannot take control of inheritance money or make any legal decisions, listing them as beneficiaries won’t be enough. You’ll want to have guardianship papers in place that determine who will take over responsibility for your kids should you be incapacitated or pass away, especially if you’re raising your children alone.

    2.  Purchase Life Insurance

When it comes to life insurance, the general guideline is that, if someone is dependent on your income, then you should probably have life insurance. So, if you’re raising children by yourself, you’ll want the security of a life insurance policy to ensure your family’s needs will be covered. Sitting down with a financial advisor will be useful in determining how much insurance you’ll need in your unique situation. Some factors you should be considering are how much you expect it to cost to raise your children and pay for their college and any assets you want to protect or debt you wish to pay off. You’ll also want to speak to an attorney about how you can properly name a beneficiary for your life insurance policy. 

There is an abundance of options out there for you to choose from when it comes to life insurance, so be sure to do your research and talk to those who are experts in the area and who you can trust. Though it may seem superfluous or extreme, life insurance policies can be an affordable and efficient way to protect your family.

SEE ALSO: Estate Plans Versus Wealth Transfer Plans


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