Welcome to the latest series here at the wildly popular JosephSangl.com – “Managing Money As A Single Parent”!
Part Four Establish financial margin
Nothing will create financial pain and agony like having no savings. Without financial margin, you will always be on the brink of financial disaster. If you are a single parent with no money in savings, you clearly understand that even simple expenses like replacing a car tire can wreak havoc not only on your finances, but also on your emotional well-being.
You can not PROSPER if you do not SAVE.
It doesn’t have to be this way! As outlined in I Was Broke. Now I’m Not. [Click HERE to get your copy], the first step to establishing financial margin is Rung #2 of the I Was Broke. Now I’m Not. Ladder – Saving an amount equal to one month of your expenses. For most single parents, this is between $2,000 and $4,000. Your number will vary based upon your geographic location and cost of living. If you have this amount in savings already, you know how very important it is to your financial and emotional stability! If you do not have this amount saved, take clear note of this fact: You can not prosper if you do not save. It is simply impossible.
This is yet another reason why it is so important to prepare a monthly budget. You will not stumble your way to saving money. It happens on purpose through the use of a good budget. It allows you to be intentional about saving money and establishing financial margin. Ultimately, you want to grow your savings to an amount equal to three months of expenses (Rung #5 of the I Was Broke. Now I’m Not. Ladder).
PRACTICAL STEPS TO TAKE:
- Determine your savings goal (One month of expenses for you is: $______ )
- Save your entire tax refund
- Eliminate a regular expense or bill that is a “want” (like Cable, Starbucks coffee (gasp!), or gym membership) and save that money until you’ve achieved Rung #2 of the IWBNIN Ladder.