Being a single parent is hard work. It’s also expensive, with the U.S. Department of Agriculture recently reporting that the estimated cost of raising a child from birth through age 17 is $233,610. That comes out to nearly $14,000 a year.
If you’re a single parent with one income, paying for your children’s clothing, food, education, and activities might not only be consuming most of your money, but most of your time, too.
At the end of another long day, you might think that it’s simply too difficult to plan or save for your own retirement.Fortunately, this isn’t true. Yes, saving for retirement will be more challenging for single parents. But it can be done, and the steps to start saving and investing for retirement aren’t overly difficult.
Here are five moves single parents should make today to prepare for their future retirement.
1. Make a budget
Nothing is more important than creating a household budget, and making one is simpler than you think. Once you have a budget, you’ll be able to figure out how much money you can allocate to retirement savings each month.
First, write down how much money you bring into your household every month. Next, list how much you spend. Start with your fixed expenses, which includes everything from your monthly mortgage payment to your insurance costs. Then, calculate an average cost for expenses that fluctuate. These can include utility bills, transportation, clothing, groceries, and entertainment. Don’t forget to include intermittent expenses, such as haircuts and car maintenance bills, which you might think of in annual terms — find the average so you can estimate a monthly amount. Once you have these figures, you’ll know how much wiggle room is left each month to put toward your retirement.
Compiling a budget can also help you make positive changes to your overall spending habits. Maybe you’ll find that you’re spending more money than you’re bringing in. You might then make a few small adjustments — such as eating out less, cutting the cable cord, or dropping a gym membership — that will free up money each month.
2. Start small and build an emergency…
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