Financial planning tips for single parents
Tip No. 1: Take care of estate planning
The most important thing to do for your underage children is to decide whom their guardian will be, says Ten Haagen. Someone who is your age or younger is ideal; an older person might not be around if something happens to you.
Ten Haagen recommends choosing an executor who has a head for finance and is well-organized, as the executor will need to make sure fees are paid and to put assets where they are supposed to be.
"You need a will that is up-to-date, specific and clear," Ten Haagen adds. He also recommends a durable power of attorney and a health care proxy. "Review your will periodically (every three to five years) or when there is a life event," he adds.
Life insurance (see Tip No. 7) can help provide for your children's needs should you die before they are adults. The proceeds can be placed into a trust with guidelines for distribution that you determine in advance. Here, you need to select a trustee who will ensure your wishes are carried out.