Financial planning for single parents | By GARY E. CROXALL, CFP® and SOREN E. CROXALL, CFP®


Raising children can be one of the most rewarding experiences in life. It is also very costly. From clothing, food, day care, tuition, the costs quickly add up. According to the latest statistic released by the Department of Agriculture, for a child born in 2015, parents can expect to spend about $233,000 raising that child from birth to age 17. That number doesn’t even include college expenses!

Additionally, according to a 2016 report done by the U.S. Census Bureau, there are about 11 million families in the U.S. that are headed by single parents which presents some unique goals and objectives. Below are a few items for single parents to consider.

Have your estate plan in order

While we always feel that having your estate plan in order is an integral part of financial planning, it is imperative for single parents. You want to make sure that you have a plan that spells out exactly what will happen to your assets if something were to happen to you to make sure they properly provide for your children. A properly designed estate plan can also spell out guardianship choices that you would like for your children. Work with a qualified professional to make sure you have a properly drafted plan that will carry out your wishes.

Be properly insured

Although no one likes to think of their own mortality, life insurance can provide much-needed financial support for your children should you pass away unexpectedly or prematurely. Another important type of insurance to consider is disability. If you are the sole breadwinner of your household, what would happen if you could no longer work because of a disability? These two types of insurance are especially important for one parent households. A qualified financial professional can help you determine your needs and how to properly structure these types of insurance.

Budget, budget, budget…

We like to think of cash flow being the bedrock of any properly drafted financial plan. It’s important to know what money is coming in and where it is going. If you don’t have a good grasp of this, it is hard to plan for other goals like education costs and retirement. Take a few minutes to determine where money is coming in from. Consider various sources like earnings from a job, child support or alimony. Then lay out your monthly expenses. Determine what costs are relatively fixed and what costs are more flexible. Also, pay close attention to income sources that may not be around forever, like alimony, and plan accordingly.

Create a balancing act between saving for education and retirement

While most parents would say they want to fully pay for their child’s college education and fully fund their retirement, this may or may not be feasible depending on budget constraints. If you find yourself putting all of your savings into a college account and nothing in a retirement account, you may need to reassess. A financial professional can help find a balance between these two goals as well as helping prioritize shorter term goals you may have as well.

There is no question about it, being a single parent is a challenging full-time job. It is easy to get caught up in the things that need attention right now. That might be the children’s school schedule, homework, sports activities, health needs or just plain being there for them. It can be an exhausting undertaking, not to mention you might be holding down a “day” job! It is easy to put off doing some basic financial planning, but it does not make it any less important. Carve out a little time to do some simple financial planning and then spend a little more time with your kids. You’ll be glad you did!

Gary E. Croxall, CFP®

Soren E. Croxall, CFP®

Croxall Capital Planning

Advisory services provided by Croxall Capital Planning (CCP), a Registered Investment Advisor. Separate advisory and securities services may be provided by National Planning Corporation (NPC), member FINRA/SIPC, and a SEC Registered Investment Advisor. CCP & NPC are independent and unrelated companies. Please consult with your representative to confirm on which company’s behalf services are being provided. NPC and CCP do not provide tax or legal advice. The information contained herein is for general education and is not intended as specific advice or a recommendation to any person or entity. The opinions expressed in this article do not necessarily reflect those of NPC.