As a parent, there’s nothing you want more than to provide for your children. That’s why it’s so crushing when money problems prevent you from giving your children everything they deserve. However, the financial problems you face today don’t have to define your family’s future. If you want to create long-term financial security for your family, these are the steps you need to take.

Step One: Get Your Finances in Order

Assess your income and expenses

You can’t budget if you don’t understand how much money is coming in and where it’s going out. Write down all of your income sources, including after-tax income from jobs and side gigs, child support and alimony, and benefits like Social Security, disability income, or SNAP. Next, list all of your non-negotiable monthly expenses like rent, groceries, insurance, utilities, and loan payments. If you’re a homeowner, you need to consider whether owning your current home fits in your budget. You can use a home-cost calculator to figure out your monthly costs. 

Rein in your spending

Ideally, your income should cover monthly expenses with money left over for savings. If you have a budget surplus on paper but you’re living paycheck to paycheck in reality, you need to reduce spending. Little indulgences like eating out or buying gadgets and games add up, especially if you’re buying impulsively. Look over past credit and/or debit card statements to see where your money is going, then set a discretionary budget that gives you enough money to enjoy life while still leaving plenty for savings.

Increase your income

Sometimes, the problem isn’t that you’re spending too much — it’s that you’re not earning enough. If you barely make enough money to cover the bills each month, you need to increase your income to become more financially secure.

Earning more money is easier said than done, of course. You can try asking for a raise, taking more hours at work, picking up a side gig, or looking for a new job that pays more. If your skills limit your income, look for inexpensive ways to boost your resume like taking a class at a community college or enrolling in free online courses. It may take a while to see results, but over time your hard work will pay off.

Step Two: Protect Your Family’s Future

Start an emergency fund

Once you’re not living paycheck to paycheck, you can get serious about saving. The first step is starting an emergency fund. An emergency fund should hold three to six months of expenses and only be used in true emergencies like an unexpected car repair or a layoff. By using an emergency fund instead of a credit card, you don’t have to go into debt when hit with an unexpected expense.

Make an estate plan

Your family still needs to be cared for when you’re not around. Even if you don’t have many assets, you should still have a basic will. A basic will designates a guardian for minor children and a trustee to manage any assets you leave to them. If you’re worried you won’t be able to provide for your children after you’re gone, look into purchasing life insurance. If you don’t know how much life insurance you need or what it will cost, use a calculator to estimate your coverage and rates before you start shopping around.

Protect your income

Death isn’t the only thing that threatens your ability to provide. If you get sick or injured and can’t work, it won’t be long before you’re struggling to keep a roof over your family’s head. Unless you have disability insurance, that is. Disability insurance replaces a portion of your income if you’re unable to work. You can buy individual disability insurance policies, but first, ask your employer if they offer coverage.

Financial problems can feel inescapable. But even if you’re barely keeping your head above water today, it’s possible to create a brighter financial future for your family. If you need more help finding the best path forward, reach out to a nonprofit credit counseling organization for guidance.

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Post Credit : Sara Bailey – thewidow.net