How I make my financial life work as a single mum by choice

About three years ago, I became a single parent. It wasn't something I'd set out to do.

Like many women, I pictured raising children with a partner. But after several failed relationships in my early 20s, I realised that maybe it wasn't going to happen for me the usual way.

I had always been quite independent, so I thought, "What if I could just do it on my own?"

The more I investigated it, the more I realised that was what I wanted to do.

The hardest (and best) decision of my life

Becoming a single mum by choice (SMBC) was one of the hardest yet best decisions I've ever made.

The early months were a mess of sleepless nights, self-doubt, and constant worry.

I was on my own — and while the early days were a struggle, I have no regrets.

Choosing to become a mother involved a lot of planning and considerations: emotional, physical, and financial. I had to consider:

• Can I afford this?
• What financial help is available to me?
• How long can I take maternity leave?
• Will I be able to cope with pregnancy, physically and mentally?
• Will I be enough?

The journey begins

In late 2017, I started trying to conceive at home, with a known donor.

Although many SMBCs undergo IUI (intrauterine insemination) or IVF (in vitro fertilisation) doing this can be very expensive, with many spending all their savings or even dipping into their superannuation to undergo fertility treatment.

The decision to start trying came only a few months after I started to take control of my finances and work towards becoming debt-free.

I grew up in a low-income family where financial literacy wasn't something I remember being taught.

My future child became my reason for turning things around.

Alongside trying, I was building my savings and paying off my debt. I became debt free in 2018 and a year after that, I fell pregnant with my son, who was born in August of 2020.

By the time my son was born I had $40,000 in savings. I'd been made redundant in late 2018, receiving a payout that helped boost my savings.

I was in a new job within three months, though, making sure that my new job had paid maternity leave so that I could take time off with my baby.

Careful planning goes a long way

For me and many other SMBCs, financial considerations are a big factor in the decision to have a child.

For single parents, whilst there is help from Centrelink, you are limited in the income you can make while you aren't working.

Maternity leave and financial support were the biggest considerations for other SMBCs that I spoke to.

"Before I become a SMBC, I moved from a contract job to an ongoing one to ensure I would qualify for workplace maternity leave, as well as government paid parental leave," says Sarah, surname withheld for privacy.

"I had money saved up to finance my fertility treatment as I didn't want to have to dip into my super or take out a loan. Once I was pregnant, I saved as much as I could, as I knew I wanted to be able stay home with my baby for as long as possible."

Personally, I spent the first year at home with my son. This consisted of 17 weeks of a mix of annual leave and maternity leave from my workplace and then 18 weeks of paid parental leave (PPL).

After my PPL finished, I lived on benefits, topped up with my savings as needed. Centrelink benefits brought in 40 per cent less than I was making at my full-time job, which meant there was some strict budgeting going on.

I utilised all the cost-cutting measures I could, like buying second-hand clothing, toys or goods and more generally, working out the difference between a want or a need.

Navigating return to work as a solo parent

Making the decision to return to work was another complex one, weighing up the cost of childcare with how much I would earn working part time or full time and then how my benefits would change.

Striking the right balance can be tricky.

Understanding what Centrelink payments you're entitled to is also important, as these can help complement your work income. It can be a mine field, but the extra income really makes a difference.

For us, the future looks good. Amidst all the cost-of-living problems we are doing well (luckily).

We live frugally, but I'm still saving some money and working towards my goal of buying a house one day. A few years ago, I started investing some money in the stock market through exchange-traded funds (ETFs).   

Once we have our forever home, I hope to start saving and investing for my son. Alongside my own investment portfolio, I want to grow his so that he has something for when he leaves home.

My goal is simple. I want to teach him as much as I can about finances, so he doesn't make the mistakes that I did. I want him to thrive, not just "survive".