Written by Annalise Winter Carson
Exclusive for moxie-dude.com
Single motherhood is undoubtedly a challenging endeavor, but it can also be a fulfilling experience. Over 100 million women globally are single parents. For these women, it can be more difficult to plan and save for long-term investments, such as their child’s education. Even if costs for education continue to rise, that doesn’t mean it is impossible to plan for. With foresight, the right tools, and determination, planning for your child’s education is entirely possible. Here’s a guide on how to do just that:
Open a custodial account
As a single parent, you need to be concerned about your child’s financial assets as early as now. Knowing that investments compound over time, it’s best to start early to save for your child’s education and other needs in the future. Opening a custodial account would be ideal in this case.
Business Insider’s guide to custodial accounts explains it as an investment account under your child’s name, which you will manage until they come of adult age. The upside to custodial accounts for single moms is that they are generally much more affordable, more manageable, and less restricted than other specialized education accounts or trust funds. It’s also flexible, so anybody can put any amount of money into a custodial account, including friends, family, and parents.
Look into a Registered Education Savings Plan (RESP)
It’s important to think long-term as a single mother. Not only should you be saving for your child’s education a few years from now, but you should also be investing in their tertiary-level schooling. In this case, you can consider a Registered Education Savings Plan (RESP).
A guide to RESPs on Wealthsimple defines it as a tax-advantaged account that helps Canadian citizens save for higher education. These funds can be invested in different ways. It also doesn’t matter who opens the account, as long as they are both Canadian citizens. It can be you, your child’s grandparent, or even a friend of the family. You can take advantage of family RESP and group RESP plans to get more support for your child and start investing early in their college education.
Start school hunting early
If you want the best options for your child while keeping it within your budget as a single parent, then you must start school hunting early. Too often, parents have failed to prepare adequately for schooling, leaving little time to assess each institution and get a slot at the right school. And as a single mother, having a good support system at school is even more important because it will influence your child’s development heavily.
When starting your school search, do so at least 18 months in advance. You need time to visit each school and evaluate each one. Application processes and requirements can also take up the bulk of your time, so be sure to get your deadlines right. This also gives you time to work with a consultant, if necessary.
Teach kids how to budget their allowance
Mothers wear a variety of hats, with single moms often having more to juggle. But one of the most important hats a mother can wear is that of a teacher, particularly with personal finances. When it comes to this subject, the sooner your youngster learns about the value of money and its place in their life, the better.
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