If you're a single parent, life can often feel like a juggling act. Not only are you trying to provide for yourself and your family on a single-person income, but you are also having to squeeze in all of the time-consuming duties of being a parent while working. Being a single parent is a joy, but it comes with its own unique set of challenges.
If you are the only income earner in the household, as well as the sole caregiver, then it is important to be able to stretch your money as far as possible and make it work for you. That's why every single parent should consider investing their money in financial markets. With that in mind, here are five simple investment tips that all single parents should take on board.
1. Start Early And Have Goals
As a busy single parent, the first thing you need to do is outline your investment goals as early as possible. The earlier you invest, the greater your long-term returns could be, which may help shore up your family's financial position and independence. Even investments with modest returns could potentially see decent gains over a long period. For example, if you decided to invest £500 a month in an S&P 500 index tracker in 2010, you would have over £120,000 today. Such simple, low-effort investments are ideal for those with busy schedules.
2. Take Advantage Of All Available Avenues Of Support
As a single parent, you have several financial opportunities available to you that are not available to others. For example, if you are working then you are entitled to a single parent working tax credit of £2045 per year. Also, check if your employer offers a pension match guarantee and max this out immediately if so, as this will likely greatly increase your pension pot for retirement. Make sure to check HMRC as well to see what tax breaks and refunds you are entitled to as a single parent.
3. Invest In A Way That Fits Your Schedule
One of the main reasons why single parents might be put off from investing is that they simply can't imagine fitting it into their busy schedule. However, modern technology has made it easier than ever to invest in financial markets without it taking up any of your precious time. The advent of mobile foreign exchange (forex) trading apps, for example, allows you to execute investments and trades via your smartphone on the go. What's more, many of these apps allow you to execute copy trading, in which your investment activities can be automated for you. This is an effective way to participate in financial markets without it getting in the way of your everyday life.
4. Diversify Your Investment Portfolio Early
Another important tip is to make sure that you are not putting all of your eggs in one basket. Even if you invest all of your money in a strong, dependable asset like gold, you are still putting your future nest egg in a vulnerable position. Spreading out your money across a variety of investments is a great way to offset risk and ensure that there are many different avenues for your investment to grow. You don't need to be an experienced financial wizard to pull this off. If you're a newbie when it comes to investing in stocks, then consider investing in a low-yield index fund tracker that follows the FTSE, the Dow, the DAX, and others. This an effective way to diversify with practically zero effort on your part.
Grow Your Investment As A Single Parent
With these simple steps, you can grow your investments and make your money work for you, allowing you to spend more time on the things that truly matter, like your family.
