5 Best Saving Options for Single Parents
Usually
there are two parents for children to take care and one of them is the bread
winner for the family as a whole. Under double income families with sufficient
savings and investments, it is quite convenient to maintain the usual
activities of the household. What if you are the only parent in your family to
look after your kid or kids? What are the ways in which you can adopt best
saving options for single parents?
Things
can go wrong if there is no savings or proper financial planning for the kids
in case there is demise of the last or sole bread winner. Nobody thinks of any
eventuality but if proper financial planning is done, you can save your
children form many hardships if a prudent line of actions is drawn for their
future. We all have a limited amount of funds, and the needs are rising day by
day, and you don't know what urgent need appears up anytime. So, for those
situations, we must have some ready funds, saved, to be utilized. Therefore we
need to know what are the best saving options for a single parent.
Keeping
in view the various financial issues involved in providing for the children,
listed below are the 5 best savings options for a single parent.
Insurance
First
and foremost, one should take a life insurance policy. A Life Insurance plan
ensures that your family is financially secure even if tomorrow you are no
longer around to care for them. Life insurance is a unique investment that
helps you to meet your dual needs - saving for life's important goals, and
protecting your assets against risk. Life insurance provides money typically to
beneficiaries after a loved-one who has life insurance dies. There may be many
types of insurance policy but for a single parent to provide for protection
against unexpected eventuality, buying a term life insurance policy is an
affordable alternative to costly conventional savings
oriented life insurance policies.
Buy a House
Secondly,
the best saving option for a single parent is to buy a house in order to
provide for shelter and financial security to the dependent in case of the
death of the parent. This is definitely one of the best saving options to
create wealth indirectly. If the financial position of the family is strong,
then the house can be bought otherwise you can buy a house by availing home
loan to buy property. Buying a house serves dual
purpose-savings as well as investment and keeping in view the tax benefits and
other perks associated with home loan, you can create huge wealth in future for
the security of the dependent.
Investment in Pension Plans
Pension
is an arrangement for which people have to invest in their working life. There
are hardly any companies that provide for Pension Plans today and even if they
do, how many actually stick on to the same job for long to be eligible for the
same? Retirement is a stage for which people do not want to think in their
early working life. But if you are a single parent and have to look after the
dependents then planning to save in pension options is a must. That’s why
investment in pension plans needs to be planned for well in advance so that the
corpus is ready by the time you plan to retire or in case of the loss of the
bread winner.
Fixed Deposits
Fixed
deposits as they are known because of their tenure are a safe savings cum
investment option that must be resorted to by people with dependents
particularly single parents. Fixed deposit is the most handy liquid tool for
meeting out unexpected emergencies-be it breakdown of household goods, medical
emergencies or unexpected travel. Fixed deposit or term deposits are a safe
investment for which you can apportion a small amount every month on a SIP
basis and deposit it as fixed term deposits for future use.
Systematic Investment Plan (SIP)
Systematic
Investment Plan (SIP) is another smart financial planning tool for a single
parent to create a corpus, by investing small sums of money every month, over a
period of time. SIP is a method of investing a fixed sum, regularly, in a
mutual fund scheme, ETF or direct purchase of stocks. SIP allows one to buy
units on a given date each month, so that one can implement a saving plan for
themselves. SIPs also help in availing benefits of compounding allowing
investment to grow at a fast pace.
These
are some of the options which should be resorted to by single parents in order
to provide for the maintenance of their dependents. Even if there are no
emergencies, still saving on a regular basis can go a long way to build
sufficient corpus for their wards.
Thanks admin to share this useful information.i have a plan to do my financial planning in various options for savings and investment to enjoy wealth in god way.keep on sharing
ReplyDeleteRegards,
Arjun