Welcome to our first installment of Financial Fridays! More on the overall purpose of Financial Fridays I’ll explain later, but for now let’s dig in!
What are your feelings about your finances? Do any of these ring true for you?
- “Finances stress me out!”
- “Finances, um, no, I don’t think about that stuff too often.”
- “Oh, yeah, I LOVE to pour over spreadsheets and budgets! I can’t wait to develop each month’s forecast!”
Regardless of your take on finances, this series will make the most of every minute to make sure you have a plan and can execute that plan no matter where you are starting from! Let’s jump in!
One huge benefit I want to start with before we get to the meat and potatoes here. I want you to think of your status of single parent as a real blessing, a serious advantage when it comes to money. Think you don’t buy that statement? Well, let me explain:
3 Financial Benefits for Single Parents
- If you are the primary or custodial parent for your children, you have the backing of your state’s child support agency to handle the payment of child support and/or enforcement if you are not receiving it. Take advantage of these benefits!
- You are likely eligible to use the Head of Household filing status when filing taxes each year. This will help you with tax savings, which equals more money in your pocket for you and your family. This is another big blessing!
- As a single parent, there is no other person you must consult with or compromise with to determine how you will spend your money.
With these advantages in mind, let’s start out with the 4 Money Basics:
The 4 Money Basics
1. Know Where you Stand
The very first step is getting an accurate picture of where you stand. This is super simple! Simply print out your bank statements from every account you spent from last month. Where did you spend money from? Checking account? Credit cards? Both? For any and every account you spent money from, print last month’s statement and place them all in a pile.
2. Get Out the Trusty Calculator
Yes, I’m talking about the real-deal, big button calculator! Let’s not use fancy Excel spreadsheets or any other complicated apps right now! Make an appointment with yourself for one hour one night this week to sit down at your kitchen table with a pad of paper, a pencil, that big ‘ol calculator and the statements you printed from Step 1.
3. Add it All Up
Yeah, I get it, this might not be the most fun step, but we’re going to add up two different things:
- First, add up all income that was received into your bank account (salary, yard sale proceeds, eBay sales, child support, etc.). Write down that number on your pad of paper.
- Second, add up all expenses from all of your accounts! It’s not necessary to put them into categories unless you prefer that. I’ll show you how to prioritize in a later post. Write down that number on your pad of paper.
4. Assess and Plan
So, how did your numbers look? Did you bring in more income than you had in expenses? Or did you spend more than you brought in? Take a hard look at those numbers. Become familiar with each of them. Really think about every expense. Really assess where your money went last month. You might be surprised like I was!
More than likely after this exercise is finished, your wheels will be turning, thinking about your life, your money, where you want to be in 5 years, 10 years, 20 years and during retirement! Let your mind think on that for next week and in next Friday’s post I’ll discuss some of my findings! I’ll also share with you some things I’ve completely slashed and burned from my January budget! Can’t wait to share more with you next week!
What is one thing you struggle with concerning finances? Does any of it keep you up at night?