Debt is a Big Hurdle for Single Women-What to Do About it!
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Today I am welcoming Stacy from Kiss Your Money to talk about Single Women and Debt! Debt causes stress in anyone’s life, but there are unique considerations for single women (and single mothers) with debt. Make sure to check out Stacy’s blog and thanks for reading!
Americans love debt.
Oh! This is not something you’re reading for the first time.
You have read about the subject in articles and heard about it from the hundreds of financial experts several times.
Do you know that single women are badly hit by credit card debt, even more so than men?
Almost 26% of women are not at all sure that they can pay their credit card bills this month.
This figure is almost double the percentage of men. Only 14% of men are not sure about paying their credit card in this billing cycle.
Why are single women so vulnerable to debt?
Why does debt hit them more savagely than men?
Let’s find out the reasons today, and offer some solutions!
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Why are women more likely to suffer from debt?
Unfortunately, women are often financially weaker than men, since their median annual income is less than the men.
Single women have to bear both necessary and miscellaneous expenses alone. They have no one to help take care of their emergency expenses.
It’s very difficult for them to make extra payments on their debt to get rid of it quickly!
The median woman’s wage is $41,554. The median man’s wage is $51,640. So you can see the difference right in front of you.
If the total debt amount is $10,000, then it will eat up much more of a single woman’s wage than a single man’s wage. So single women are at a disadvantage.
Debt is a massive problem for single mothers. They have to bear double expenses with or without financial support.
Faced with the challenge of taking care of all the expenses with a comparatively small salary, they are forced to rely on credit cards.
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It’s a harsh reality for several single women in the country.
Credit cards help single moms to cover emergency expenses without asking for financial help. And let’s accept it, food, school, gas, clothes, and daycare are expensive.
It’s difficult being a single mom – both emotionally and financially.
Yes. Single moms know that they have to pay high-interest on the cards, but what other option do they have?
Debt, along with income struggles, make it difficult for single women to build an emergency fund, and so the cycle of debt continues.
Single women may resort to options like payday loans to fulfill their short-term financial needs. The interest rates on payday loans are even higher than credit cards, and can be as high as 500%, which is enough to drain anyone’s savings within a couple of months.
The financial literacy rate in women is lower than men. This is another reason why women struggle to manage money. Women’s magazines or online resources don’t put emphasis on financial tips and strategies as much as they do lifestyle, cooking, fashion, glitz, and glamour.
How can single women get out of debt?
There are a few tips that can help single women to get out of debt and lead an uncomplicated financial life. Here are a few of them.
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1. Take Advantage of Credit Counseling
Credit counselors suggest various tricks and strategies to pay down debt.
They create a smart budget and help debtors save money. Budgeting is something many women (and men!) struggle with.
They can go for credit counseling to get a basic idea of debt management techniques.
2. Enrolling in a Debt Settlement Program
When the debt amount is too high, single women can enroll in a debt settlement program to pay off their dues comfortably.
These programs help to lower the outstanding balance and eliminate late fees.
If the total debt amount is $10,000 and the creditor agrees to reduce it to $5000, it becomes much easier for women to pay it off. They can save the other $5000 and use it toward other debt or savings.
3. Consolidating their Credit Cards
A good tip to deal with multiple high-interest credit card bills is to consolidate them with an affordable monthly payment plan.
A debt consolidation program allows single women to pay off multiple credit card bills with a single monthly payment, so it becomes easier for them to manage their debts.
What Single Women Should Learn About Money
The first and foremost thing that single women should learn is the art of budgeting. They need to spend money smartly and save money for their emergency expenses so they don’t need to rely on credit cards.
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Second, single women should choose a job carefully. Since their salary is often lower than men, they should watch out for good employee benefits, and opportunities to increase their income.
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Finally, single women should consult a financial planner and start investing early. The goal is to increase income in whatever way they can.
It’s tough to say when the disparities in the median income of men and women will be gone. Till then, single women need to be extra careful when it comes to money management. They have to learn the art of budgeting, saving money, paying off debt, and building their nest-egg. Only then, will single women be financially independent.