Millions of U.S. households live on a single income. Whether your family consists of a working spouse and stay-at-home spouse or you are a single parent, living on one paycheck can be a challenge. Limited funds may leave you feeling discouraged about credit repair, but there is good news: everyone can afford to improve their lives with the right strategy. Consider the initiatives below. They will help you focus on credit score improvement, regardless of your income.
- Create a budget—today. Wise use of your resources requires a game-plan. Creating a budget is an effective way to become more aware of your expenditures, avoid overspending, and set aside money for savings. Download our free editable template to get started. A single income is best spent with a plan in mind.
- Consider sharing credit perks. If you are married and living on a single income, it’s tempting to allot all the financial burdens and benefits to the wage-earner. Think twice before taking this route. The unemployed spouse’s credit is important as well, and sharing account and credit lines can help you build mutual strength. Start by splitting the bills: half in your name, half in your spouse’s name. If you have an auto loan in Spouse A’s name, be sure to include Spouse B’s name for the next account. Marriage is a partnership, but your credit score is an individual measurement. Share the responsibilities and perks that come with wise spending.
- Set short-term goals. It’s easy to feel discouraged if you are drowning in debt or credit damage. Short-term goals can help you shrug off uncertainty and focus on attainable tasks. For example, suppose your main source of worry is credit card debt. Commit to cutting 15% of your miscellaneous spending over the next six months and using your savings to pay down debt. This strategy allows you to take control of your credit health in small, manageable steps. Once you have achieved that goal, focus on the next credit boosting initiative.
- Look for tax breaks and other benefits. Uncle Sam is fond of providing tax breaks for single income households. Talk to your accountant and click here to learn more about the qualifying benefits of a single income household. What you discover could help you save hundreds or even thousands of dollars each year.
- Consider non-traditional income sources. Rising costs and inflation often mean stretching your dollar beyond its worth, forcing your family to live with credit card debt and other burdens. If you are tired of overspending and living with the consequence, it might be time to find other sources of income. The good news: there are plenty of flexible opportunities that allow parents to work and care for their children. Consider:
- Online jobs. Work-from-home careers are more accessible than ever thanks to an evolving workforce and online commerce. Search for jobs in your niche by using job boards like Indeed.com (hint: enter “remote” in the location search box). Setting your own wages and hours is the perfect way to increase household income without disrupting your family’s schedule.
- Affiliate earnings. If you have a popular blog or social media following, affiliate marketing is a useful way to earn passive income. For example, suppose your family is fond of a particular children’s book. You review the book on your blog using an affiliate link provided by Amazon, which pays you a portion of the sale price for every book purchased. Many companies also pay for sponsored content. Use you online presence to establish passive income.
The bottom line: Surviving on a single income is tough for any family, and it’s essential to take advantage of every credit-boosting opportunity. Remember these tips as you aim for excellence. You don’t need wealth to join the 800 Club.