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- Budgeting coach Clarissa Moore knows firsthand how difficult it is for other single moms to manage their finances.
- Moore recommends five simple budgeting tips, starting with creating a budget aligned with your goals.
- You should also adjust your budget regularly and start small with savings.
Clarissa Moore, a 35-year-old single mother who earns a six-figure income, has learned to manage her personal finances the hard way.
A traumatic car accident in 2009 that seriously injured her 11-month-old daughter also left her with money troubles that snowballed over the next five years. In 2013, she finally landed a steady job at an electric company where she earned $14.34 an hour.
From there, she committed to improving her relationship with money. Moore simultaneously paid off her debts, built up a healthy emergency fund, and focused on creating multiple sources of income in addition to her corporate work.
Today, Moore earns six figures from a variety of sources, including a financial coaching service, through which she advises others on how to do what she did. Paid partnerships through her Clarissa Explains Money Instagram page also help her share personal finance tips with her 127,000 followers every day.
Here are five key budget tips Moore has for other single moms looking to better manage their finances.
1. Start small with your savings
Moore knows firsthand how many financial hurdles stand in the way of single mothers building real wealth.
“Daycare is ridiculous,” she says. “Start small with savings. I started saving $5 at a time, and there were months where I saved $2,000 just because I had it.”
In theory, Moore says, if you can save $5 at a time, it’s easier to create the habit of saving regularly. It then becomes easier to keep cash flow, such as a tax refund or an annual bonus.
2. Ditch budget strategies that aren’t working for you
“There’s a lot of budget information out there,” Moore says. “Some things work for some people, but some things don’t work for everyone. Then you feel bad because you’re like, ‘Oh, this person is using this budget and they’re so successful, and I’m do not understand.”
Resist the urge to compare yourself to others and instead focus on finding the right budgeting strategy for you, she advises.
For example, Moore once tried the cash envelope system, but soon found that it caused more headaches than the promised benefits. Although it’s incredibly inconvenient to get money regularly, Moore understood what made money envelopes appealing in the first place: the ability to organize your funds into different categories.
“What worked for me was having multiple bank accounts so I could have multiple buckets to invest money in,” she says.
3. Create a budget that reflects your goals
There’s a common mistake Moore sees among single moms: They believe they don’t earn enough to create a budget in the first place.
“The amount of money you make doesn’t determine whether or not you need a budget,” she says. “If you make a penny, you have to budget that penny.”
When creating a budget, she recommends starting with your end goals in mind. For Moore, his savings goal was to buy a rental property. Naturally, his monthly budget had a specific savings category for the down payment and closing costs for this home. In the meantime, she listened non-stop to real estate investing podcasts to stay motivated while saving over $23,000.
4. Regularly review your budget
Once you start budgeting and tracking your spending, Moore says you’ll begin to understand your spending habits more clearly.
“You’re not going to create a budget at 20 and it will be the same at 45,” she says. “Make sure you make those adjustments and don’t let those changes get you down. Things happen, don’t they? With kids, accidents happen. Over time, it gets expensive.”
5. Pay yourself first
Single moms need to reward themselves first, Moore says. No matter how much or how little you have, allocate a small portion of your income to getting your nails done, buying something small, or treating yourself to a meal with friends.
“Give yourself an allowance,” she says. “We work very hard for our money. So for us working all the time, working overtime and then having to let it all go to the bills, from a psychological point of view it doesn’t make sense. When you do something and you don’t see any results, you want to quit, right?So you have to do things for yourself, even if it’s only $20 a month or $20 a week.
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