Did you know that one in four parents in the United States is single?1 In fact, 19.6 million children are being raised by single parents .2 Most single-parent households (81 percent) are led by moms, but quite a few (19 percent) are led by dads, according to a recent Pew Research Center analysis .3
Whether due to death, divorce, or choice, single parents face unique financial challenges. Budgets are often more stressed, child care can be a struggle, and saving for the future might feel impossible at times.
These challenges come in a broad range of areas:
Knowing that millions of other parents are in your situation and have faced the same struggles can make it easier to ask for help when you need it. And there are steps and possible solutions passed on by their experience.
1. Income. Unless you’re in a position where you are receiving generous child support and alimony payments, bringing in enough money to support both yourself and your children is a challenge for many single parents. Having trouble making ends meet? You’re not alone. MassMutual’s 2018 State of the American Family Study found that nearly one in three families is struggling to get by.
One option for easing the burden is to move in with a friend in similar circumstances or a helpful relative. In fact, about one in four solo parents lives with their own parent.4 Having more than one adult contribute to household bills, chores, and child care can alleviate many burdens of single parenthood, even if you keep your finances separate.
2. Child support. “If your child’s other parent is responsible for paying child support, it will likely be no surprise to you that only about half of all child support payments are ever made,” said Todd Christensen, education manager of Money Fit by DRS based in Boise, Idaho.
Indeed, in a 2015 study , the U.S. Census Bureau found that “less than half (43.5 percent) of custodial parents who were supposed to receive child support received full child support payments.”
When child support arrives sporadically, if at all, it can be difficult to manage a steady budget. Christensen suggested using your own income to cover basic living expenses — housing, food, clothing, cell phone, gasoline, insurance, and internet service — and using any child support that does arrive for discretionary items such as travel, a prepaid cell phone for your child, movie and TV subscriptions, birthday and Christmas gifts, and other non-necessities.
3. Credit. The financial challenges of single parenting can lead to debt and late payments, and both can damage credit scores. Poor credit, in turn, makes it challenging to rent or buy a home or secure a lower-interest loan that would help with getting out of debt.
Three things will start you down the path toward improving your scores. First, get a free copy of your credit report through www.annualcreditreport.com to see what’s dragging down your scores. Second, commit to making minimum payments on time. Third, sign up for a credit monitoring service, some of which are offered for free, to stay on top of your scores.
4. Debt. Interest is expensive. For every $1,000 of debt you carry at 10 percent interest, you’re forking over about $100 per year. Chances are, you’d rather put that money toward emergency savings, child care, or basic living expenses.
How do you get out of debt? The first step is setting up a budget where you assign a role to every dollar you earn. The next step is tracking your expenses so you can see exactly where every dollar is going. Then, figure out where you can cut back to put more of your dollars toward your debt until it’s paid off. A budget can also help if you’re dealing with unreliable child support.
5. Child care. The logistics and cost of getting care for your child while you work can be difficult. As many working parents know, child care can eat up a significant part of your income.
The Care.com 2018 Cost of Care Survey found that child care is unaffordable for more than seven in 10 American families, with the national average weekly cost to care for one infant child ranging from $195 at a family care center to $580 for a nanny.5
Contributing to a Dependent Care Flexible Spending Account (FSA) through payroll deductions, if your employer offers this benefit, can reduce the cost by allowing you to pay with pretax dollars. So can taking advantage of every child tax break you qualify for.
6. Taxes. If you’re divorced, it’s important to be clear about who gets to claim the child tax credit . You’re entitled to a $2,000 credit for each dependent child you financially support who lives with you for at least six months during the year. Parents can’t split the credit, but they can take turns claiming it in alternate years.
As a single parent, you may also qualify for head of household status , which increases your standard deduction from $12,000 to $18,000, as well as the earned income tax credit and the dependent care credit.
Learn more: 5 overlooked tax deductions
7. Errands. Single-parent households have a fraction of the time for household chores like shopping, cleaning, and meal preparation, Christensen noted. One possible solution is to team up with a friend or neighbor in a similar situation.
One week, you can do the shopping for both households, and the next week, your friend can do it. Combine this teamwork approach with the growing availability of grocery ordering services: place your order online, then pick it up on the way home from work to save on delivery and tipping costs.
8. Meals. Working single parents often lack the time and energy to cook, making drive-thru food appealing. “However, it is also expensive,” Christensen pointed out. “A single drive-thru meal for one adult and two children can easily equate to one or two hours of the work you just put in.”
The solution he suggests lies in your freezer. “Consider making three or four dinner servings of the same meal on a Saturday morning and freezing them in separate freezer bags,” he said. “After five or six weeks, you will have almost a full menu of meals in your freezer for each weeknight.” To add greater variety, join forces with a few friends or neighbors and trade meals.
9. Retirement savings. A classic mistake single parents (and married parents) make is to prioritize saving for their children’s education over saving for their own retirement. Your child may qualify for more financial aid if you put yourself first by saving for retirement instead of college. Further, while loans and financial aid exist for college, they do not exist for retirement.
It can be tough to prioritize retirement savings as a single parent, especially if you don’t have access to a retirement plan through work. Many single parents end up working part-time or below their skill and education level; the job that provides the flexibility they need to care for their children isn’t always the one that offers the best pay and benefits.
You may want to consider opening a Roth IRA or other retirement account and having a small sum automatically transferred from your bank account to your retirement savings each month.
Learn more: 8 FAQs on Roth vs. traditional IRAs
10. Insurance. Life and disability insurance are important backstops to consider for the well-being of your family, especially if you have no partner to fall back on. If you weren’t able to provide physical, emotional, and financial support for your children because of death, a serious illness, or injury, who would? Insurance, along with a will that assigns custody of your children, can help solve these problems.
In MassMutual’s American Family study, nearly three in four families reported that having a stable source of income for their family in case of the unexpected was a priority. Ideally, you may want to consider carrying enough life insurance to support each of your dependent children until age 18.
If you can’t afford that much, consider buying as much term coverage as you can; you may be able to increase it later. If you're thinking about your children's college educations, you may want to consider a coverage amount large enough to help pay for tuition and other educational expenses if something were to happen to you.
Disability income insurance is also essential. It will help replace part of your income if you’re too sick or hurt to work. Disability policies can be used to supplement other insurance plans, such as Social Security Disability Insurance.
Calculator: How much disability income insurance do I need?
Perhaps more so than married parents, single parents need to rely on acts of mutuality to get by. Asking for help doesn’t mean becoming someone else’s burden when you offer to support them in return. Whether this means exchanging prepared meals, taking turns running errands, starting a play group, or carpooling, every little bit helps. Combine this support with a solid financial plan and you’ll be able to take excellent care of your kids — and yourself.
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1 Pew Research Center, “The Changing Profile of Unmarried Parents,” April 25, 2018.
2 United States Census Bureau, “Historical Living Arrangements of Children: Table CH-1, Living Arrangements of Children Under 18 Years Old, 1960 to Present,” Nov. 2018.
3 Pew Research Center, “The Changing Profile of Unmarried Parents,” April 25, 2018.
4 Pew Research Center, “The Changing Profile of Unmarried Parents,” April 25, 2018.
5 Care.com, “This is how much child care costs in 2018,” July 17, 2018.