When you’re single your financial planning will be significantly different from when you’re in a couple and it’s important to adapt to your circumstances to get the best from your money. Perhaps you might feel more pressure to create financial security or you might recently have become single and need to reassess your finances – either way, here are some great tips on getting financial planning right when you’re on your own.
Set savings targets. Many people wait until they’re in a couple to start setting savings goals but there’s no reason why you should do this now, particularly as waiting can put additional pressure on you to find someone to share your life with. Set your savings goals and targets now instead and start working towards them. Whether you want to put money aside for a deposit to buy or you’re saving to take a year off work and go travelling, while your money is all your own this is a great time to start building up your financial safety nets.
Pay off debts. There are no savings interest rates out there that will pay you more than you will lose each month on outstanding debt so before you even start setting savings goals get debts cleared off. Whether you have debts from a failed marriage or you’ve just graduated with university debt, the first step for any financial plan should be to clear those outstanding amounts. After that you can start putting money aside for a rainy day.
Have a timeline. For really focused financial planning you need to have those long-term savings goals, alongside time-specific milestones and monthly aims too. Being single is the ideal time to really focus on your finances as you’re in complete control and there are no complications such as shared expenses or joint accounts. This is a great time to get into good habits so figure out what works for you in terms of the milestones and goals you can set yourself.
Look to the future. Sometimes when you’re single it’s difficult to look too far into the future but successful financial planning requires that insight. That means considering pensions, for example, and deciding how to invest any extra money that you might have either now or when that time comes in the future. If you don’t yet have any disposable income over and above paying off debt and meeting monthly obligations then start by researching your options for the future. This will not only motivate you to work towards this but will mean you’re prepared to hit the ground running when you do have extra income.
Find savings where you can. There are many ways in which you can make savings as a singleton – for example, if you’re living alone then you should be eligible for a single person discount on your council tax. You can use less heat, light and hot water than you would as a couple and you have more flexibility to live somewhere cheaper where you can save money, rather than having to take someone else’s requirements into account too. As you’re in complete control of your money shop around for deals on utilities rates, insurance, broadband and groceries to get the best deals on everything you like.