Navigating the current financial environment as a single woman

Now, more than ever as inflation spikes, it’s critical that single women be savvy with their finances.

So say financial experts Jill Gianola and Margaret Price, authors of “Single Women and Money: How to Live Well on Your Income.”

The two share best practices on how single women can successively navigate the current environment, as well as how to best manage debt and what to do if hiccups arise.

Gianola is a certified financial planner and founder of Gianola Financial Planning LLC in Worthington, Ohio. She has been recognized as one of the top 100 planners in the US by Mutual Funds magazine, and Money magazine featured her advice in “Secrets of America’s Top Advisors.”

Price, an award-winning journalist, has been an editor at Bloomberg Wealth Manager magazine, international editor at Crain Communications’ Pensions & Investments magazine and senior editor at Treasury & Risk Management magazine.

Price is also a past president of the New York Financial Writers’ Association.

Katie Kuehner-Hebert: April’s Financial Literacy Month is just around the corner – what should single women know now?

Margaret Price: This year, the public is facing an onslaught of inflation – and with it, concerns about how to cope. Unlike dual-earning couples, single women often survive on one income, which is typically less than what men earn. Thus, single women may want to do extra financial planning in this environment.

First, they should review their budget and prioritize necessities like housing, food and transportation costs and then see what can be postponed, like a new car. But they shouldn’t deprive themselves. Their budget should still include affordable items, maybe dinner with friends, that are especially important to them.

They should also determine what additional income sources they can get, such as a salary increase or renting part of a home or apartment.

They also should also review their investments. In today’s inflationary environment – with rising interest rates – they should explore whether portions of their portfolio need adjusting.

Jill Gianola: Inflation presents some extra challenges for single women, as they don’t have a spouse’s income as a backup.

But in this era of a shortage of qualified workers and high turnover, this could mean single women may have opportunities to counter inflation, by either asking for a raise, getting a better job or even entering a new occupation.

How can single women best save for the future when they’re struggling to pay off debt?

Gianola: That’s one of the toughest aspects of managing money – trying to balance different goals. There’s a lot of competition for dollars when trying to accomplish multiple goals and the question many ask is which goal do they deal with first.

However, a good strategy is to have a plan for each goal and to make progress on each during the year. If a person ignores one area of their finances, they may lose valuable ground.

Price: Many employers now automatically enroll their workers in their 401(k) retirement plans. Funding comes out of employees’ gross earnings, so they are not seeing that money – it goes into their retirement savings plan automatically.

This automatic process helps ensure employees are saving for the long term, even in the face of multiple other demands on their income. The process can be especially helpful to single women, who often survive on one income.

If an employer doesn’t offer a retirement plan, people should contribute to their own IRAs, setting up monthly automatic contributions. The younger workers begin this process, the more funds they will accrue over time.

Is there an acceptable level of credit card debt a single woman can carry?

Gianola: Single women should be able to comfortably pay off credit card or revolving debt in three to five months, and if they add extra debt, they should increase their payment amounts every month.

If a person struggles to pay off debt in six months, they should rework their budget to free up extra money to debt repayment.

To fund vacations and other high-dollar expenditures, single women should consider setting aside money in a special purpose fund, and they should also have a separate emergency fund large enough to cover three to six months of basic expenses.

Price: I believe consumers, including single women, should avoid carrying a balance on their credit cards. Why add expensive interest payments to the things you’ve already purchased?

If you need to travel to California for a friend’s wedding this summer, don’t put the trip on a credit card – find ways to budget around it.

Cut corners in the months prior to the trip, and stay with a friend while in California. In fact, some people routinely use their debit card for payments to avoid overspending every month..

How do single women find financial help in hard times?

Price: Our book has a whole chapter on this, including listing resources that single women could turn to for an array of issues, from being penniless to finding a financial advisor who can help them on a pro bono basis, to sources to turn to if they can’t afford their medications.

But if someone hits upon hard times, a good rule of thumb is to go to their local government official’s office and ask them which government agencies could help them – that’s one of the fastest ways to get help.

They also should apply for SNAP – the government’s Supplemental Nutrition Assistance Program, formerly known as food stamps, to avoid going hungry.

They should also call their credit card company and tell them about their situation. Typically companies will find a way to accommodate such customers, as they don’t want them to declare bankruptcy.

If single women are short of funds to pay their rent, they should speak to their landlord, and sometimes states or municipalities will have programs than can to help them avoid eviction.

Gianola: Single women should also stay away from payday lenders – it’s the worst place to get money because the interest rates are exorbitant. Instead, they should check if their payroll provider or local bank will extend a short-term loan – a much cheaper way to fund a gap than turning to a payday lender.

Even if they aren’t penniless but just feeling stressed, career counselors and therapists specializing in money issues can help them. We also love the idea of single women getting together to talk about their finances, maybe even after their book clubs. Single women can feel more confident about their money if they talk to friends about what works and what hasn’t worked for them, and learning from each other.