10 Financial-Planning Tips for Grieving Solo Moms
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Tending to practical needs after your loss
When a woman loses a husband or a partner, the grief sets in quickly. This is a life-altering experience, and new Solo Moms must face it alone. Even as they grieve, these women must parent their children. This is a Herculean task. Even as the tsunami of grief builds, the everyday needs of a family do not cease. New Solo Moms face a host of challenges as they strive, through grief, to meet the needs of their children—including present and future financial needs, which are especially challenging given the loss of a revenue stream.
If you’ve just become a Solo Mom because of the loss of a partner, this article is for you. As you face the growing, overwhelming task of balancing grief and parenting, use these tips to protect your financial assets.
- Meet with a qualified professional to analyze your income. Seek help through your network to find someone able to offer assistance. Don’t make decisions about how to spend money—especially onetime lump-sums such as payments from life insurance policies—without mapping out a clear strategy with someone who knows how to maximize yields and decide where money should be spent.
- Take a global look at personal finances and make a strategic plan. This may involve anticipating shortfalls and deciding how to best address them. You may need to look at places to live that are more economical than your current situation.
- Set a budget and stick to it. Find trustworthy online tools to help you decide what monthly expenses you must address and then rank their priority. Many banks offer assistance to families addressing budgeting questions. By deciding what to spend and where, you are able to budget for things beyond basic necessities.
- Consider how and where you save. Many financial planners strongly urge that parents, including Solo Moms, save for retirement before all else. They urge that Solo Moms consider their ability to support themselves as they age even before college savings for children. If it is possible to do both, that is ideal. However, if you have to make a choice, there are more alternatives, such as loans and scholarships, for children to attend college than for Solo Moms facing the prospect of retirement. Consider asking your parents or in-laws to help with educational planning. There is often a tax benefit for them to do this, and if they are in a position to make up a shortfall, they very well may welcome the opportunity to assist in this way.
- Get the best health insurance available to you. Health-care premiums can be burdensome, but so too can the cost of an unanticipated medical emergency. Health-care options will vary wildly from state to state, but look at provisions and plans available under the Affordable Care Act. Don’t forget to investigate whether there is any relief under insurance plans you participated in if your husband or partner had a benefits package through a job.
- Have an emergency fund. Establish an emergency fund for unanticipated monetary needs. Make sure to contribute toward this fund with discipline. You never know when a large expense is coming—a house repair, dental work, or car repair. These sorts of things can blow a budget if there is not a line item for their payment.
- Establish legal guardians for minor children. Make sure to establish legal guardians for minor children. It is also necessary to have a current will, a power of attorney (in the event that you are incapacitated), and a separate health-care power of attorney for medical decisions. For further information read this helpful article by Teachers Insurance and Annuity Association–College Retirement Equities Fund (TIAA-CREF) covers these and other issues in more detail.
- Buy a life insurance policy. Buy a life insurance policy for yourself and designate your children as the beneficiaries of the policy. The money from this can be put into trust and allocated to cover your children’s needs by working with guardians and attorneys. Buy the insurance while you are as young and healthy as possible in order to derive maximum benefit at the lowest premiums. Consider a term policy and anticipate the kinds of things you would like the policy to cover in the event of your death.
- Get disability insurance. If you are a single-income household, you need to protect against lost income. This is what disability insurance can provide—income in the event that you are temporarily unable to perform your job. While most policies don’t cover your full salary, it is certainly worth it to meet with a benefits administrator at your job to review options. Make sure to explain the absolute importance of this benefit to your family in order to find the best possible alternatives. Consider the benefits of each policy and whether you are interested in short- or long-term disability. The premiums will vary based on your own circumstances, health, and other factors.
- Think about long-term care insurance. Many advisors would prioritize this last, but if it’s financially possible, it’s a good investment. It allows for care in long-term situations such as declining health that is not likely to improve—this often applies to geriatric populations, for example. This is a way to anticipate considerable expenses in the future and spare some of the cost to your caregivers.
If you have more questions, Sister Chat is a great way to find out how other Solo Moms handle these issues. It’s confidential, so feel free to ask the hard questions.
Tara Shafer is the cofounder of Reconceiving Loss, an online resource center for families coping with pregnancy and infant loss. She is a contributing blogger to the Huffington Post, Psychology Today, and BabyCenter. Her work has appeared in the New York Times and on National Public Radio. You can follow her on Twitter at @reconceivinglos.
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