In the world of motherhood, our responsibilities seem to be never-ending, from getting our kids to school to carpooling to helping with homework to maintaining the house. It's easy to see why planning for college isn't always top of mind—especially for single moms solely responsible for juggling household tasks, their children's busy schedules and the family finances. Getting your kids to college may seem an overwhelming task, but don't let that push you into inaction. And most importantly, remember that you don't have to go it alone.
More than four of 10 single moms polled by OppenheimerFunds said that, compared with married mothers, it's less likely that their kids will go to college. Yet single moms certainly aren't lacking in commitment to get their kids a college education—in fact, more than a third (35%) said they are more concerned with getting their kids to college than with their own retirement. For these mothers, it's truly all about their kids: Single women said that they value their own kids' happiness over their own and are used to getting by on less and can manage to do so in retirement.
But while you are passionately devoted to your children's personal success, it doesn't have to come at the expense of your own financial security. As a single mom, you face unique financial challenges. But following these quick, simple strategies can help you pursue college for your kids and a financially secure retirement for yourself.
Don't Go It Alone. There are many resources and tools available to help you navigate the college savings process. From guidance counselors to teachers to other moms to financial professionals, there are many places to turn for invaluable help and perspective in planning the best financial path to get your child to college. Don't neglect to ask family and friends about their best sources of advice. Suggest too that they help you meet your college saving goal by contributing to a savings plan in lieu of birthday or holiday gifts.
Know Your Options. Half the battle is simply knowing what saving and investing vehicles exist. In addition to 529 plans, Coverdell Education Savings Accounts and UGMA/UTMA accounts, you may want to look into other saving options such as brokerage, money market or trust accounts. Check out the Investing Basics section to learn more about basic investment types and how to get started. Finally, through rewards programs, even spending money on your credit card can help accumulate college savings.
Don't Put Yourself Second. Stay committed to your child's success—but don't neglect your own financial security. When it comes to sending your child to college or retiring comfortably, it doesn't have to be either/or. Think of college and retirement as twin savings goals, and when you make a small monthly contribution to a college savings plan, also make a deposit into a retirement account. Savings products that accept regular automatic withdrawals from your checking account make this easier. Keep in mind: Your family will benefit from both savings programs, since you'll help your kids get to college and be able to maintain your financial independence in retirement.
Consider the Complete Picture. As a single mom, one of the things you do best is break down your day into small, manageable steps. The same strategy applies to college savings. Set a realistic monthly savings goal that you can commit to meet and start saving early. College cost projections can be daunting, but if you make spending time with your finances a part of your daily routine, you can reach your college savings goal. Check out Other Ways to Save to learn about different savings methods and get started as soon as possible.
Make the Most of Scholarships and Aid. While financial aid and scholarships can supplement the cost of tuition, it's still important to create a financial plan that doesn't assume high amounts of aid/grant money, as research indicates that most parents overestimate how much supplemental funding their kids will receive. When your kids are old enough, set aside time to conduct scholarship searches with your child and learn the ins and outs of financial aid.
Source of Data: "Keeping College Within Reach" study sponsored by OppenheimerFunds, Inc. 1725 parents (1141 women and 584 men) were polled online between September 25 and 29, 2009 regarding their views and practices around planning for college. You can find a complete report in the trends and analysis section on www.collegewithinreach.com
Investments in 529 college savings plans and mutual funds are neither FDIC insured nor guaranteed and may lose value. Please note the plan's disclosure document or fund prospectus includes details such as investment objectives, risks, charges and expenses, and other information that investors should read and consider carefully before investing. You can obtain plan disclosure documents and fund prospectus from each 529 plan or the fund company.
Oppenheimer funds are distributed by OppenheimerFunds Distributor, Inc.
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