For starters, budgeting and keeping a tab on your earnings as well as spending can be quite useful. Setting up an emergency fund for a rainy day, prioritizing the important expenses, and working your way down can help you save on non-essential items. Constantly seeking out ways and means to earn some extra cash are albeit baby steps but in the right direction.
Dealing in cash instead of credit or debit transactions and forever looking for cheaper substitutes and cost-effective alternatives is single mom financial planning 101. Buying a health cover for yourself and your kid(s) can effectively take care of any unforeseen medical expenses that could otherwise dry out your savings in a blink of an eye.
For long term returns and adequate financial security, setting up high yielding savings and investment plans is one of the best financial advice for single mothers. Some savings accounts cater only to women and offer annual rates amounting approximately to 7.25%, which can help you earn interest equivalent of a fixed deposit with more freedom.
Investing in a Systematic Investment Plan (SIP) towards Mutual Funds is something that you should consider for all your life goals, including your child’s education, marriage, etc. Mutual funds are most suitable for tackling inflation and are extremely rewarding when compared to traditional savings methods like ULIP or PPF etc. Any financial planning for single moms should definitely feature mutual funds as a top priority.
Opting for term insurance is another wise financial move to protect your family against life’s risks. Proper term insurance will provide an assured amount to your beneficiaries in case of any untoward incident. It is also important for you to prepare a will and decide the guardians for your children. Also, finalize an executor who you completely trust and is good with a financial decision.
Finally, one of the crucial financial advices for single mothers is not to ignore retirement. It is crucial for you to plan your retirement and start saving & investing for your retirement. This can be done via various mutual fund schemes, National Pension Scheme, Atal Pension Yojana, and other retirement plans available on the market.
Learn more about Mutual Funds for a good personal financial management.
The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
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