The single life: Sometimes it’s by choice, while for others, by circumstance. Regardless of how you came to fly solo, there are unique financial questions to consider and manage. Proper planning on a single income can ensure a life lived to the fullest without sacrificing enjoyment.
Whether you’ve never been married or you’re divorced or widowed, there are strategies you can use to plan for a financial life that’s all about you, says Shannon Lee Simmons, a Toronto-based Certified Financial Planner® professional and founder of The New School of Finance.
Shannon offers these tips for when you’re charting your own course with your money:
Plan for expenses
Large expenses like housing may take up a significant portion of a single income. Take the time to allocate funds to cover your fixed expenses, then establish a budget to help determine what’s left to save or spend as you wish. A well-planned budget can go a long way to removing uncertainty that may come with self-reliance.
2. Cover your bases
Review your insurance coverage to be sure it covers your needs and supplement it if necessary. Consult a pro to find out what safeguards you might need in your individual circumstances.
3. Share the load
Sharing a lease, renting out excess space in your own home, or sharing the purchase of property with a friend or relative can all help to offset the big-ticket cost of housing. Having a roommate can mean the difference between having to get a second job and being able to relax after work. Life often feels like it’s built for two. Consider mimicking that financial situation if it works for you.
4. Find a sounding board
Being single doesn’t have to mean making every decision by yourself. A CFP professional can act as a trusted advisor to help navigate life choices that come with financial consequences. They can also help find additional creative strategies for finances in singlehood.
5. Reap the rewards
It’s amazing what finding an extra few hundred dollars can do for your life and your future. Finding those savings can be easier when you make all the spending decisions and don’t have to account for a partner’s possible debt. When you see how even small savings can help you reach your financial goals, you’ll be motivated to find even more.
6. Chase your dreams
Do some soul-searching to explore financial and life goals that inspire you, then work with a financial planner to develop a plan to reach them. And because you don’t have to square away your vision of your life with someone else’s, the sky’s the limit on how you live your life.
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For more ideas on how to take control of your financial future, read 5 ways you might be sabotaging your finances and Never too late to start: Retirement planning in your 40s and 50s and watch Your million-dollar plan.