6 Secrets of Single Parents Who’ve Slashed Their Bills, Paid Off Debt and Built Empires

A single mother hugs her daughter.
Elisabeth Nyang, left, and her daughter, Gabriela, hug while going for a walk in Fairbanks, Alaska. Nyang was able to raise her credit score nearly 200 points. Tina Russell/The Penny Hoarder
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Life as a single parent can be hard. You might constantly feel tight on time — and money.

If you’re looking for some money advice, we’ve got stories from single parents who’ve paid off debt, cut their expenses and built business empires.

They share their tips and secrets for financial success. And, hey, you can even start using some of their strategies right now.

 

Secret No. 1: Don’t Let Your Credit Score Tell You Where You Live

A mother and daughter go for a walk in Fairbanks, Alaska.
Elisabeth Nyang and her daughter, Gabriela, go for a walk in Fairbanks, Alaska. Elisabeth used Credit Sesame to raise her credit score. Tina Russell/The Penny Hoarder

You have enough going on in your life as a single parent, so when it comes to taking care of your credit score, it’s easy to pass it off as a “one of these days” type of chore. But what happens when you want to buy a home? Or a car? That seemingly arbitrary number starts to play a huge role in your life.

So let’s start with the basics. When’s the last time you checked your credit score? If it was recently, good for you! If not, take a few seconds to do so right now.

We like using a free website called Credit Sesame. Not only can you see your credit score, you can also see what factors are affecting it.

When single mom and traveling speech therapist Elisabeth Nyang created her Credit Sesame account back in January 2017, her credit score was at 495. For context, credit scores on the VantageScore model range from 300 to 850. She was also $17,500 in debt.

Nyang used Credit Sesame to keep and eye on her score and her accounts with negative balances. Credit Sesame also gave her advice on how to improve her score — and reminded her to make a credit card payment when her credit utilization rate was getting too high.

“I like how everything’s in layman’s terms,” she said. “It’s user-friendly, and it’s easy to understand.”

When we talked to Nyang in 2018, her credit score was around 663, a near 200-point increase.* She’d planned to continue to use Credit Sesame to improve it. Her next goal? Take out a mortgage and buy a home for herself and her daughter.

Secret No. 2: You Can Leave Your Kids $1 Million (Without Being an Actual Millionaire)

Rebekah Pearsall, and her son, Riley,7, tour the construction site of their new house that is under construction, in Ashburn, VA, on Dec. 2.
Rebekah Pearsall, and her son, Riley, tour the construction site of their new house in Ashburn, Virginia. Ting Shen for The Penny Hoarder

If you have kids, you’ve probably worried about what’ll happen to them if something were to happen to you…

For single mom Rebekah Pearsall, this was difficult to consider. “Since my son doesn’t have a biological father in his life, I wanted to make sure he was secure if something were to ever happen to me,” she said.

That’s when she started looking into life insurance.

Before you start thinking you don’t have the time or money for that, look into policies through a company called Bestow. It offers $1 million policies starting at only $5 a month. Your application shouldn’t take more than about five minutes.

You can change or cancel your plan at any time. Plus, the security of knowing your family is taken care of is priceless.

Pearsall had seen firsthand the benefits of life insurance; her childhood friend lost his dad and life insurance helped his family make it through that time financially. “I’ve been sleeping great since I got this,” she said.

It takes only a few minutes to get a free quote.

Secret No. 3: You Can Live Debt-Free — Even on One Income

As a single parent with a single income, paying down your debt while raising a child can feel impossible — but it is doable.

Take Kumiko Love, for example. When the 33-year-old single mom graduated college back in 2011, she owed more than $100,000 in student loans, credit cards and medical bills. It took her a few years to get on track, but Love started budgeting, and she watched the debt dwindle.

No single budgeting method worked for her, so she combined three, and this year she reported she’s happily living debt-free. She quit her job to focus on her own business, a blog called The Budget Mom.

Budgeting is a great way to get out of debt — in fact, it’s an essential — but we understand it can quickly get tricky, especially when you have multiple forms of debt. So, to get yourself on stable ground, here’s what we suggest: Debt consolidation.

When you consolidate your debt, you take out a personal loan, one that has lower interest rates and more favorite terms than your current situation. Then, you’ll use that personal loan to pay off your debt. At the end of the process, you’ll have one, super-manageable monthly payment to fit into your budget.

It might sound counterintuitive at first — like you’re just moving one form of debt over to another — but the truth is, paying one bill each month will be a lot easier, and this could even lower your payments, save you tons of money in interest and/or allow you to pay off your debt faster.

If you’re not sure where to start looking, use a website called Fiona. It’ll match you with a low-interest loan — rates start at 3.84%. It won’t make you stand in line or call a bank. (We know you don’t have time for that.)

And if you’re worried you won’t qualify, it’s free to check online. It takes just two minutes, and it could save you thousands of dollars.

Secret No. 4: You Can Probably Save More Money on Your Bills

Cars parked in California.
Chris Zuppa/The Penny Hoarder

As a single parent, you’re juggling your housing costs, your typical monthly bills, your groceries — and not to mention exorbitant childcare costs. How do you do it?

If you need some help — or honestly just want more room in your budget — it’s time to start taking a harder look at your bills. Which ones can you negotiate? Which ones can you ditch altogether?

Lourdes Robles-Velazquez, a single mom living in California, felt this way. She told us she watches her every penny and trims her budget down as much as possible. But one thing she couldn’t avoid was her $205 monthly car insurance bill for her car and her daughter’s car — but she did find a way to cut it by 40%…

A service called Gabi compares car insurance rates to help you find a cheaper policy — with the same coverage and deductibles you already have. And it saves customers an average of $865 a year.

You don’t have to fill out any forms. Just link your existing insurance account and enter your driver’s licence, and it will start looking for cheaper coverage.

Plus, after you sign up, Gabi will keep looking for savings. No more shopping. 

Since she signed on with Gabi two years ago, Robles-Velazquez has changed insurers twice to save money. Following Gabi’s suggestions, she’s moved from Liberty Mutual to Allstate to Mercury Insurance.

“Right now, I’m paying $125 a month for both cars,” she says. She used to pay about $205, which means she’s saving close to $1,000 a year.

Secret No. 5: You Don’t Need an MBA to Start a Business

After a bad car accident back in 1993, single mom Kate Sauls spent a year wheelchair bound, raising two kids and living off welfare.

Her injury required her to keep heat on her neck and shoulder — but imagine doing that while trying to lug kids around. That’s when she had an idea: The Kozy Collar, a hot-and-cold therapy pad that’d stay on your neck.

Sauls had no business degree and very little capital, but she hustled, and within nine months she’d made $64,000 selling her product at local craft shows and flea markets. When the recession hit, Sauls had to shut her operation down, but that didn’t stop her.

Fast forward to 2013, and Sauls created ThermaStretch, a solution to her knee pain. The idea was similar: a heating pad that fit around the knee and stayed in place. She was hesitant to launch another business, but her kids encouraged her.

She now sells her products online (primarily Amazon and Etsy). Last year, she even had the opportunity to sell on HSN, where within eight minutes she told 750 units, yielding almost $30,000 in revenue.

Sauls’ words of advice? “If you’re passionate about it, don’t be afraid of failure, because that is the road to success.”

Secret No. 6: Don’t Miss Out on Cash Kickbacks When You Order Online

Did you know some stores have price-drop policies to pay you back if something you buy online goes on sale after you buy it? But here’s the reality: Unless you revisit every website you ever order from, how would you know? Who has time for that? Especially busy single parents.

Good news, though. Capital One has a free tool called Paribus that knows which stores have policies like this, and it does all the tracking for you. All you have to do is sign up with your email address and keep your emailed receipts. Then Paribus will help you get a refund when it finds a price drop on something you’ve bought.  

We talked to one busy mom who has used Paribus to save $1,315.41 in about two years. Aimee B. says to save time, she does the majority of her shopping online — her clothes and household necessities.

“It really is as simple as giving your email address,” she says. “It’s kind of a no-brainer.”

Paribus monitors more than 25 retailers, including Target, Walmart and Home Depot, and has found more than $29 million in savings for customers. 

One last perk: If your guaranteed Amazon shipment shows up late, Paribus will help you get compensated.

Disclosure: Paribus compensates us when you sign up using the links we provide.

*Like Nyang, 60% of Credit Sesame members see an increase in their credit score; 50% see at least a 10-point increase, and 20% see at least a 50-point increase after 180 days.

Credit Sesame does not guarantee any of these results, and some may even see a decrease in their credit score. Any score improvement is the result of many factors, including paying bills on time, keeping credit balances low, avoiding unnecessary inquiries, appropriate financial planning and developing better credit habits.

Carson Kohler ([email protected]) is a staff writer at The Penny Hoarder.