Motivation Taxes & Benefits

Improve Your Financial Health This Year

Improve your financial health

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 always challenging financially, especially if you have 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 main financial goal every year. That is to be able to retain their employment or business and to cover the essential expenses for their children and themselves. And yet, even this goal can be achieved more effectively if you try to expand on it a little further.

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 carry a good portion of financial despair due to the difficulties they face every day. It’s definitely true for me. Whether it’s the never-ending legal costs, exorbitantly high daycare and aftercare expenses, or housing charges, it can weigh us down internally. It might seem that there is no light at the end of our financial tunnel. And, yet, there is. It starts with you making a mental shift into where you want to be rather than where you are now. And to connect to this vision better, you need to write down 1 or 2 goals that you would like to see happen this year. These goals don’t need to be hefty, and even if your goal is to merely cover all your bare essentials every month without accumulating 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 to you.

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 fail to provide adequate assistance to help single parents and their children prosper, 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 one. Yes, it is not easy to find money to set aside, but whatever small amount you can put towards your emergency fund today will make your financial health much stronger.

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 big 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.

Take some time to think what it really means to improve your financial situation to you personally. After all, this goal can mean very different things to different people. As I’ve mentioned in Step 1 above, your goals don’t need to be hefty or so ambitious that you will feel stressed out before you even start working on them. Avoid the temptation of researching other people’s goals 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.

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, and I had no time to take on a second job or do anything else that would require my very limited time. I set this goal at the beginning of each year, and about a few months later I was able to add exactly $200 extra to my salary by simply filing a tax form I did not know about before (read about this form in my previous post, and raise your salary today!)

As you can see, my goal was unique and so was my challenge, but I did make it happen by not setting goals that would make feel frustrated at the end.

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