Being a single parent is tough. Between groceries, childcare and trying to keep a roof over your head all on a single income, it can sometimes feel like there’s not quite enough to go around. But the good news? There’s plenty of financial help available if you know where to look.
From budgeting hacks to Centrelink benefits for single parents and tax perks, this guide will walk you through some of the smartest money moves you can make as a single parent. Whether you’re wondering, “What financial support can I get as a single parent?” or looking for tips on planning for the future, we’ve got you covered.
Practical budgeting tips for single parents
Smart money management starts with a detailed budget. Not sure where to start? Here’s how you can master your budget on a single income.
Track your income and expenses
Put simply, a budget tracks what’s coming in against what’s going out. Building a budget starts with your income and expenses. You can keep it simple with a spreadsheet or use a budgeting app to help automate your budget. Just make sure to include all your income and expenses, no matter how big or small.
Prioritise essential spending
Once you’ve tracked your income and expenses in your budget, you can start categorising your costs. From here, you’ll be able to determine what expenses are essential and what costs you could cut from your budget. Focus on rent or mortgage repayments, groceries, utilities and childcare before discretionary spending, like subscription services and eating out.
Find ways to cut costs
Now that you know how much you’re bringing in and where your financial priorities lie, you can start finding ways to cut your costs. Just because you're cutting costs doesn’t mean you need to forgo certain things altogether. Instead, you might be able to swap to a more affordable alternative, like a cheaper phone service.
Build an emergency fund
The money that you cut and save in your budget can be put towards growing an emergency fund. Even contributing a small amount each week can help you to grow your savings. This emergency fund can then be used to cover unexpected costs whenever they pop up.
What financial support can I get as a single parent?
There’s plenty of financial help for single parents through Centrelink. Here’s a quick rundown of some of the main payments you could be eligible to receive.
Parenting Payment
The Parenting Payment is the main income support payment for eligible single parents. This payment is available to single parents until their youngest child turns 14. The amount depends on your income and assets, with some part-time work allowed before payments start to reduce.
Family Tax Benefit
The Family Tax Benefit (FTB) is a two-part payment designed to help with the cost of raising kids. In particular, Part B provides additional support for single-income families, including single parents, with payments decreasing as your child gets older.
Child Care Subsidy
The Child Care Subsidy (CCS) covers a portion of childcare fees to help with the cost of daycare, family day care or outside-school-hours care. The percentage covered depends on your income, activity level (work, study or volunteering) and the type of care your child is enrolled in.
Rent Assistance
Rent Assistance provides a little extra help with rent costs if you receive another Centrelink payment and pay above a set amount in rent. Once again, the amount varies based on your rent and family situation.
Tax benefits for single parents
As a single parent, managing your family’s finances can be tough. While a solid budget and government assistance go a long way, taking advantage of the right tax benefits can also help ease the load.
Low income tax offset (LITO)
If you’re a low- to middle-income single parent, you may qualify for the low income tax offset (LITO). While this benefit isn’t necessarily a cash payment, it helps to reduce the amount of tax you owe by up to $700, leaving more money in your pocket.
Claiming dependents on your tax return
As a single parent, you might be able to claim your child as a dependent, which can help reduce your taxable income by increasing the income test threshold for the private health insurance rebate and Medicare levy surcharge.
How child support impacts your taxes
If you’re receiving child support payments, it can be helpful to know that they’re not considered taxable income, so you don’t need to declare them as part of your tax return. That said, child support payments can affect how much FTB Part A you receive.
On the other hand, if you’re the one making child support payments, they can affect your FTB eligibility, as Centrelink considers them when calculating your payment amount.
Tips for maximising your tax refund
Navigating your taxes can be tricky, but claiming the deductions that you’re entitled to can help you to save come tax time. Here are some smart ways to increase your tax refund:
- Work-related expenses: If you work from home, you can claim a portion of your internet, phone and electricity costs.
- Education and training: If you’re upskilling or studying to improve your career, you may be able to claim course fees, textbooks and travel expenses.
- Medical and disability-related expenses: If you or your child has disability-related costs, you might be eligible for tax offsets or deductions.
Navigating tax benefits as a single parent can be tough, so if you’re struggling with your taxes, be sure to reach out to a registered tax agent or qualified tax accountant for help.
Financial planning for single parents
Being a single parent means managing your finances on your own, but that doesn’t mean you have to do it alone. Here’s how to take control of your financial future.
Set clear financial goals
Having specific money goals can help you stay focused and motivated. Set short, medium and long-term goals and create an action plan so you can work toward these goals step by step.
Create a realistic budget
A budget is your best friend when it comes to managing money as a single parent.
- Track your income and expenses: Use budgeting apps like Frollo or create your own budget spreadsheet.
- Prioritise needs over wants: Cover rent, food, and bills before spending on extras.
- Use the 50/30/20 rule: 50% for essentials, 30% for discretionary spending, 20% for savings and debt repayment.
- Automate your savings: Set up an automatic transfer to a high-interest savings account each payday.
Make the most of financial support
There’s absolutely no shame in accessing financial support if you’re struggling to navigate your finances. Get in touch with Centrelink to see what payments you're eligible for. The National Debt Helpline also offers free financial counselling if you’re experiencing financial difficulties and the Council for Single Mothers and their Children provides information and support for single mothers.
Teach your kids about money
It’s never too early to start teaching kids good money habits. From using a savings jar to teach kids how saving small amounts adds up to helping them to set savings goals for a toy or a special treat, these skills will set them up for financial success.
Managing your finances as a single parent can be tough, but it’s not impossible. Small steps can quickly add up to big changes, so if you’ve been thinking about getting ahead of your finances, why not start today? By setting goals, creating a budget and making use of available resources, you can build financial security, not just for today but for the future.
