I recently received a letter from a single mother faced with the challenge of finding a way of budgeting for her teenage daughter (clothing, books, extracurricular activities, etc.) on a salary of $45k and without child support. She was feeling as if she never had enough.

As a parent, we want to give our children everything we can. So here’s my advice for anyone feeling like there isn’t enough. Start your budget with some envelopes — plain old envelopes. Label each one with your money goal. Label one with clothing, one with books and so on. Then, put money, CASH, in them to cover these expenses. Allocate some money each pay period to these expenses. If the money is in the envelope, you can make the purchases, if not, you wait until the next pay period when you can add some money to the envelope.

Remember extracurricular activities are not needs. Clothes and books — gotta have those — but everything else is optional. Still, you should absolutely label an envelope with the extracurricular expense and fund it each pay period. Then only spend what is in the envelope. You may find that money you have in this envelope gets used occasionally for books or even clothes. That is fine. It will still allow you the choice.

Now, for your money management needs. $45k is a great base salary — just great. Each payday, pay yourself first. Meaning — make a deposit in your savings account. Think short-term savings first. Investing is later. Slowly, work on the habit of making that savings deposit. If you can do so, have your employer make an automatic deposit to your savings before you even see your paycheck. You will be amazed at how you live on what you take home. Consider taking any raise in your salary and banking it – sraight to the bank if you can.  Live on what you have already lived on. This way, you are creating a cushion. Again, this gives you options. Having these options ensures there will be enough for your children — and you.

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Written by Susan Beacham
Susan Beacham founded Money Savvy Generation in 1999 after almost two decades in private banking and investment management complemented by considerable time teaching at the elementary level.

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