Single mom in crisis mode

Written by
Damian Dunn

I need help! I am a single mom with two jobs, probably the worst credit in the world and zero money saved in either my bank account or retirement. Money got extremely tight recently and closed out my retirement account to pay the bills and put food on the table. I have been giving myself the face-palm ever since. I don't know what to try to fix first or how to do it so I don't feel so overwhelmed. Any advice/help would be sooo very appreciated! Thank you!


We’ve all faced times when it seems the only sane thing we can do is something we know, deep down inside, is going to make us face-palm later. And then we do it anyway. I don’t say this to minimize the struggles you’ve experienced recently, but rather to encourage you. You’re not the only person that’s faced seemingly impossible decisions with choices ranging from unreasonable to unbearable. You made your choice, good, bad, or otherwise. Now, you move on.

Based on what you shared with me, I feel pretty safe guessing you’d give yourself a 9 or 10 on a 1-10 scale of how stressed you are about your financial situation. What I hope to do by the end of this message is to give you a plan of action and hope. I want to reduce your stress level by giving you things you can work on and succeed at. As the stress level comes down, you’ll be able to keep more balls in the air. But for now, we’ll focus on one thing at a time. Ready?

In your own words, you’re a single mom that’s working two gigs and has no resources that give you some breathing room when life happens. That’s what we’ve got to change first. You need to know that you’ve got some cushion when the unexpected decides it’s time for a visit. Major car repairs, emergency medical visits, insurance deductibles, etc... All things that might not be planned on in the course of day-to-day life, but need to happen in order for us to keep going. You need to have a pool of money, a buffer, to use in these instances. This leads us to:

Goal 1: Save $100 in the next 30 days.

I know there are some readers thinking, “$100?! What’s that going to do?” I’ll tell you. It’s going to give this woman a win. She’s going to do it and get her momentum headed in the right direction. She’ll snowball that momentum into bigger and more long-term goals, and it will have all started with $100.

Here’s how I’d like you to try and do it. This will process will begin to have a large payoff in the near future, so it’s important to understand not only the “how”, but the “why”.

Goal 1, Step 1: Examine your spending statements. What’s a spending statement? Bank statements if you write checks or use debit cards and credit card statements if you use credit cards. I want you to go through three months of statements and highlight the most frequent area of spending. In other words, you spend money more times per month in this area than any other category. I’m betting that it will be one of two categories. Groceries and dining out or clothing. You’ve got kids. They seem to want to eat every day and the authorities require them to be clothed in public. You’re just going to have expenses in these areas. For this discussion, we’re going to say that groceries/dining out is your most frequent expense. I want you to determine what you’re spending per month on these two things. If that number comes out to $500, that’s $125 per week. If for one month, you are able to spend $100 per week on groceries and dining out, you’ve just met your goal. Your numbers will almost certainly be different, but you get the idea. Why would I ask you to do this? People tend to have two options at their disposal when they find themselves in situations like yours. They can make more money, or spend less money. You’ve got two jobs and I think asking you to take on a third might be pushing it a bit, so we’re left with spending less. If you can examine your spending, I think you’ll see opportunities you didn’t realize you had.

Goal 1, Step 2: Once you determine your most frequent area and create a plan to reduce spending to achieve your goal, don’t let the “saved” money sit in your checking account. Get it out of there. Transfer the “saved” money into your savings account so it’s not sitting in your checking account waiting to be spent on something else.

Bonus Tip: Get creative. Consider selling unneeded stuff at a garage sale or on eBay/CraigsList/FaceBook Marketplace/etc.. Have your kids help in age-appropriate ways. I’m always surprised by what my wife finds when she starts going through the house looking for things to get rid of.

Here’s the beauty of this first goal. It will take a month (or less) to accomplish, but the plan probably took around an hour to craft, start to finish! YOU JUST WON! Now what?

Goal 2, Step 1: Repeat Goal 1, but go a bit deeper this time. Look for some other areas of your monthly activity that you can cut back on, or even eliminate. Use your critical eye. The decisions get a little tougher this time around, but… you’re working your butt off. You owe it to yourself to make sure that both hard-earned incomes are being used in ways that benefit you and your family. As you go through your spending statements, make sure you’re controlling spending everywhere you can.

Goal 2, Step 2: If you need help getting this specific skill under your belt, consider budgeting on a weekly or bi-weekly basis. In other words, only make the money you need available for that time period available for you to spend. If there is any surplus, send that money to your savings account and forget it exists (until you need it).

Once you’ve done this for a few weeks, you’ll get the hang of it and become comfortable with the process. Eventually, you’ll have one month's worth of income saved, and it will be time to take a look at the rest of your situation. From there we could focus on things like eliminating debt, saving for retirement, or building a larger emergency fund. I’m happy to be a sounding board during your journey. Your financial sherpa, if you will.

Getting to work on correcting your situation now is entirely preferable to wait another few weeks or months. You will experience some failures along the way. I expect it and, frankly, you should, too. Recognition doesn’t excuse the failures, but rather de-stigmatize them. Put it behind you and get back to solving the problem. Don’t dwell on them. You’re hustling and they’ll only slow you down.

Finally, this process may take a while depending on how big of a hole you find yourself in. That’s ok. I know you’d like to snap your fingers and find yourself in a better position, but… There will be value in your efforts. You can use this experience as a defining moment and teaching lesson for your precious children. If they are an appropriate age, consider including them in the decision making processes you’re going to undertake.

Step up your financial wellness game.

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