Each new year brings new ideas, goals, and hopes into our lives. Unfortunately, as each month goes by we might fall into our previous comfort zone and forget what we set out to achieve this year. Did you take some time yet to think what it is you want to achieve financially this year? What about pondering some steps how you might actually do it?
Being a single mother is not an easy road financially, especially if there are additional challenges on top of being a single caregiver and provider. Depending on the stage you are at in your single mommyhood, setting financial goals might sound redundant or even silly. Many single mothers have one primary financial goal every year – to be able to retain their employment (or business) to cover the essential expenses for their children and themselves. Sounds straight-forward, but achieving even this humble goal can be done more effectively when it’s expanded further. Below, you will find simple steps that cover the essential strategies to improving your finances this year while feeling connected to your life’s bigger aspirations.
No matter how scared you might be to even think the subject of your finances at this time, consider the following steps to improve your financial health this year.
1. Jot it down
Writing down your goals really helps in more ways you can imagine. When we write something on a paper or our digital notepad, we connect with our thoughts more powerfully. Thinking about finances might sound like the last thing you want to do right now. A lot of it has to do with our inner fears.
Most, if not all, single mothers feel financial despair due to the difficulties they face every day. It was, at earlier points of being a single mother, true for me. Whether it’s the astronomical legal fees charged by family lawyers, exorbitantly high daycare and aftercare expenses, or housing costs, it weighs us down internally. We might feel trapped and depressed.
It might seem that there is no light at the end of our dark financial tunnel. Yet, it is there. It starts when we consciously make a mental shift into where we want to be rather than where we are now. And to connect to this vision deeply, you need to write down 1 or 2 goals that you would like to come to fruition this year. These goals don’t need to be something you need to scratch your head about. Even if your goal is to successfully cover monthly bare essentials without accumulating any debt, that’s a very worthy goal to pursue!
2. Get ready to file your taxes
Do you know the earliest date you can file your taxes yet? If not, find out and start getting ready early. Single mothers have a lot of expenses they can claim, and you need to get your all your receipts in advance. Usually, it takes some time to receive your tax refund from the government so you want to get this done as early as possible. Otherwise, you are “lending” this money to the government for free. If you are expecting a substantial return, think in advance how you can use these funds to make a positive impact on your financial situation. (Hint: paying off your credit card or setting up an emergency fund are the essential steps you might need to take).
3. Apply for all possible benefits available
The beginning of each year is the perfect time to research programs and benefits that might be available to you as a single mother. While most governments truly fail to provide adequate assistance to help single mothers and their children feel financially secure, you can still get that extra help where possible. These benefits can and do change, so you want to make sure to check them out early each year.
Read this post to see available benefits to single mothers in Canada.
4. Set up a small emergency fund
Everyone needs an emergency fund (read why in this Dave Ramsey’s post). Especially single mothers whose life is full of surprises! When you set aside a specific amount of money for your emergency fund, you will have a peace of mind that you would not have without having one. Yes, it’s not easy to find money to set aside, but whatever small amount you can put towards your emergency fund will make your financial health much better.
Whether you’ll be receiving a small bonus or your annual tax refund, open a TFSA (Tax-Free Savings Account) account to start saving. If you are not familiar with the advantages of a TFSA vs regular savings accounts, check out this guide by the Revenue Canada. Your contributions can be as small or as large as you can afford to put aside, and there is no penalty for withdrawing your funds from this type of account.
As a fan of Tangerine bank, all my banking accounts, including a TFSA, are with them. Besides enjoying the ease and freedom of using my accounts online, I leverage my existent savings with their unique cash bonus rewards. In other words, whatever amount I have in my TFSA earns a good interest and is automatically paid into the same account at the end of each month.
Learn how you can get $150 deposited into your new account by opening a free account with Tangerine.
5. Zoom in on your values this year
This might be a surprising step, but it can make the biggest difference and lead you to a breakthrough.
Take some time to think what it really means to improve your financial situation to you personally. Not your parents, ex partner, friends, or society at large. After all, doing well financially can mean different things to different people. As mentioned in Step 1 above, your goals don’t need to be so hefty or ambitious that you will feel stressed out before you even start working on them. Avoid the temptation of researching other people’s goals online or discussing them with your friends or colleagues. Your financial health is unique, and so the goals you set need to make sense to you.
At the same time, don’t settle for less than you truly deserve. If you really want to go on a nice vacation with your children every year, do not try to convince yourself that it is not important or you can do without. Even if it might not happen right away, you can still think of what that would amount to and create steps to start putting that in motion this year.
For example, my goal last year was to add at least $200 extra to my monthly income. I had no idea how to do it given my income did not change, and I had no time to take on a second job or do anything else that would require my already limited time. Yet, as I set this goal at the beginning of the year, about a few months later I was able to add exactly $200 extra to my salary by simply filing an additional tax form I did not know existed before (read about this form in my previous post, and raise your salary today!)
The year after that, I added an additional $80 per month to my income via this blog. Even though I see this blog as my passion project that will not be able to replace my regular income (let’s be real here), it connected me to my bigger value of helping other single mothers to do much better financially.
As you can see, financial goals are unique and so are our individual circumstances and challenges. Yet, you can make your goals happen by trying the simple steps above and by taking some time to understand what each goal means to you personally. Having that inner motivation can break through the rut of doing things just to survive. Even a small step you can take towards thriving financially this year will pay off!