When student loan deferment ended for Samantha Gregory, a single mom and founder of site Rich Single Momma, she had one reaction to her payments: sticker shock. âThe amount they were asking for was so astronomical, it was bananas,â she said.
As a single mom in debt, these high payments were added to the already steep financial demands of covering household expenses and supporting her children, including one with special needs â all on one income.
Adding debt to the significant challenges of single parenting âputs a strain on not just your finances, but your emotions, your mental health,â she said. âItâs like, âI have this burden over my head so how am I going to take care of it and take care of my family?ââ
Itâs a question any single parent in debt may find themselves asking. Thereâs no one right answer, but the good news is that there are smart steps a single mom or dad can use to tackle debt. Here are some tested and certified strategies for how to manage debt as a single parent.
A key to managing money as a single parent in debt is to keep an eye on what you owe. Gregory warned against letting debt slip in your money management juggling act. âI know for me in the past, Iâve tried to ignore it and hope it would go away,â she said. âBut it doesnât go away. Itâs still there, lingering.â
Keep your debts on your radar, so youâre not losing track of them, falling behind on payments or damaging your credit. If you donât know what you owe, pull your free credit report and look up each outstanding debt you have and record the balance, interest rate, monthly payment and due date. Start a habit of reviewing these accounts regularly.
Once you know what you owe, see if your lender offers any help or accommodations that can make this debt easier to manage.
Youâll have the most options for dealing with federal student loans, as servicers must provide you with options to forbear or defer payments, or switch to a different repayment plan.
Even for other types of debt, it canât hurt to ask your lender if theyâre willing to work with you. They might be open to giving you an extension on your payment, and some lenders will let you skip a payment now and tack it onto the end of your repayment period instead.
Help isnât always easy to come by as a single parent, so make sure youâre claiming the benefits and child support to which youâre entitled.
Federal assistance programs such as Women, Infants and Children (WIC), Supplemental Nutrition Assistance Program (SNAP) and school lunch programs can ease pressure on your budget while keeping everyone fed, for example. Other programs can assist with fixed monthly costs such as housing, child care or health insurance. Many state and local programs can offer additional help.
Single parents should also consider filing for child support. If youâre already entitled to such payments but the other parent isnât paying, or you feel itâs not enough, consider pursuing legal steps to get adequate support for your family.
As a single parent with debt, living within your means is the foundation of your financial security. Review your budget to see if there are areas youâre wasting money on things you donât need or use, whether itâs a neglected gym membership or a house youâre realizing is roomier than necessary. Consider lifestyle changes and sacrifices â big or small â that you could make to lower your monthly costs.
Look for ways to free up some of the mental space youâre using for your money, too, Gregory suggested. She likes to automate payments, for example, to ensure theyâre going out on time with less effort on her part.
To the single mom in debt, Gregory suggested looking for ways to generate some extra cash. âIâm a firm believer in side hustles,â she said. âThere are so many options out there available to create a side hustle, start a business or just get another part-time job or work-from-home job.â
Then, âlook around your house and if you have something valuable you can sell, sell it,â she said. Doing so can bring a fast cash infusion that can help you stay current on debt payments, or even make an extra payment.
It can be a tough and even emotional to sell some belongings, Gregory acknowledged. But, âItâs just things and theyâre replaceable, whereas your peace of mind, your family and kids, and your health are not replaceable,â she said.
If you can carve out extra savings, thatâs money you can use to pay off your debts faster. One method to do so is the debt snowball:
Making extra debt payments will lower your principal faster which will, in turn, lower your interest costs. As a result, this strategy could avoid hundreds of dollars in interest and shave months or even years off your debt repayment.
For a single parent, debt consolidation can be another way to get ahead. Consolidating debt makes the most sense when doing so will lower the interest rates youâre paying.
A credit card balance transfer is one way to accomplish this. You can open a credit card with a 0% introductory rate. Then, transfer existing balances to this new credit card (note that this will often incur a balance transfer fee) and you can repay this debt interest-free.
If you have higher debt balances or prefer a fixed repayment plan, a personal loan could be the way to consolidate debt. To do so, you can take out a new personal loan with the rates, term or payments you would prefer and use the loan funds to pay off and replace existing debts. You can compare various lenders with our debt consolidation comparison page to get an idea of the terms and rates for which you could qualify.
Managing debt as a single parent can be hard on you because, at the end of the day, paying them comes down to you alone. âIn the back of your mind, youâre thinking âThereâs no one who can help me with this,ââ Gregory said.
However, you donât have to go it alone â there are often people who are ready and willing to help as close as your own backyard. So let them! Family and friends can help you out in a variety of ways, from spotting you cash in a tight month to helping with child care. You can also get assistance from your church, community and local nonprofits or programs.
Even if you donât always find the help you need right away, asking around can start you on the track to getting the recommendation or referral that leads you there. Gregory also suggested online communities, such as local or single-parent Facebook groups, as a way to crowdsource solutions and get connected with helpful resources.
Debt can be a big regret for many single parents. âIf I had more information when I was going to college, I wouldnât have taken out so many loans,â Gregory said.
But these ideas for how to manage debt as a single parent can help you push past regret into action. In doing so, youâll be creating the financial security that your kids need, all while modeling what good money and debt management look like in action.
Gregory, for example, used her experience with student debt to warn her daughter away from borrowing to pay for college. As a result, âSheâs really blessed that she doesnât have to take out student loans, so she wonât be saddled with that big debt when she graduates from college,â she said.
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