If you're a single mom, know that you are far from alone. The U.S. Census Bureau reports Opens in a new window that, as of 2016, 8.5 million American families had a single mother as head of the household (compared to 2.5 million families led by single fathers). And heading up a household with no partner can come with a lot of financial stress.
However, there's no need to fear – you can find plenty of helpful information available for sole breadwinners with financial concerns, including debt.
Set a budget
With only one source of income, single mothers need to budget carefully.
How much are you spending on essentials (food, childcare, transportation) and extras, such as entertainment? Review your spending over several months to gain clarity.
Once you've identified your largest recurring expenses, look for ways to reduce spending in those areas to free up more money for debt repayment. Sky-high childcare costs? Perhaps your kids' preschool offers a discount for multiple siblings, or maybe a family member can watch the kids after school.
Get your kids involved with budgeting by encouraging them to help clip coupons, or brainstorming inexpensive family activities such as board game nights or trips to the local library. By showing them how to make financially responsible choices now, you'll set them up for future success while also providing a potential jolt to your savings.
Are you going out to dinner several times a month, or grabbing takeout when time is tight? While experiencing time crunches is very understandable, perhaps you can aim to do more home cooking when possible. Cutting the cable cord is another way to save on one high monthly bill.
Any money you free up from cutting back can go toward paying down debt, whether it's credit cards, personal loans or student loans.
Slash that debt
Auto loans, mortgages and student loans generally carry a lower interest rate than other types of debt, so you'll likely want to pay those as agreed and focus any extra money on paying down higher-interest debt, such as credit cards.
You may be able to refinance your credit card debt at a lower rate if you have a strong credit score, or qualify for a card that offers an initial 0% interest rate. Be warned: When that 0% rate period ends, the rate often skyrockets.
You can also look into getting a student loan forbearance or deferment. There are ways you can work with federal lenders to temporarily stop or reduce your monthly payments if you are going through a particularly difficult time financially.
Working with your loan servicer in this way is a much better option than just stopping your payments, which can result in a default on your record; this can be bad for your credit. In order to get a forbearance or deferment, you will need to meet eligibility requirements.
Purchase life insurance
If you are your family's primary source of income, you may need a life insurance policy in case anything happens to you while your children are still dependents. The insurance payout could cover items including college tuition or housing costs if you're not there to provide for your family.
Depending on the age of your kids, you might consider a 20- or 30-year level term policy. "Level term" means the policy will remain in effect and your premiums will remain the same for the entire term, allowing you to fit life insurance premiums into your budget.
You might also consider purchasing a disability insurance policy that would replace a portion of your income in the event that you're unable to work due to illness or injury.
Set up a 529 account
Saving for retirement should generally take precedence over your kids' college funds. Students can always apply for scholarships or earn college credits through community college or Advanced Placement courses, but you can't get a scholarship to cover medical costs or living expenses in retirement.
Assuming you're already maxing out an employer-sponsored retirement account such as a 401(k), or a self-funding account such as an IRA, you can save any additional money in a 529 college savings account. A 529 account allows you to save and invest money for college and withdraw tax-free for eligible educational expenses including tuition, textbooks, and room and board.