Built for Two: How Single Parents Build Real Wealth on One Income with Pat Hankin, Author of The Field Guide for Single Parents

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There are nearly 10 million single parent households
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in the United States, and most of them are led
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by a working parent. Picture two of these working
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women. Same country, same tax code, neither one's
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married. But one is raising kids and the other
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one's not. The woman with no kids at home has
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a median of $43,000 saved for retirement. The
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single mother has 12. Nearly four times the difference,
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and the only variable is the children. So today
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on Escape The Clock, We're aiming to answer the
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question, what do you do when every financial
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plan you have ever been handed assumes that there
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are two of you? How do we get by when there's
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one adult, one income, one bandwidth in a system
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that quietly rewards the household that has a
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partner in it? To answer this, I'll be joined
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by Pat Hankin. She spent her career in financial
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services and consulting, then found herself online
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inside a community of nearly half a million single
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parents. watching people ask the same questions
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over and over and get almost nothing back. So
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she went and wrote the book nobody had written,
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The Field Guide for Single Parents. So today
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we get into why the three expenses that actually
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move the needle are not the ones that you've
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been told to cut, the housing decision that has
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to happen before the divorce papers get signed,
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and how to make the most of a system designed
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for two if you or someone you love is going at
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it alone. So stay tuned to find out what an hour
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of your life is actually worth. and how knowing
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that one number can change every decision that
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comes after. having the option not to work. Your
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host, Daniel C. Rodgers. Almost all financial
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advice assumes two people, two incomes, two retirement
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accounts, two sets of hands to handle the laundry,
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the homework, doctor's appointments, the school
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forms, and even the bills. The entire tax code
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is built around the very assumption of marriage.
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It's in every aspect of the financial and tax
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system from retirement accounts to estate taxes.
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The benefits for having a partner stack when
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we can claim married filing jointly status on our
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returns. We widen our tax brackets and unlock
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new advantages. Standard deduction doubles. We
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gain access to spousal Social Security benefits,
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spousal IRAs, the right to inherit a 401k without
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penalty, and a dozen other quiet advantages baked
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into the system. But when filing as a head of
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household, which is the best a single parent
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could do, those deductions shrink, the brackets
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narrow, and many of the benefits simply disappear.
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And this is not a niche situation. Per the U
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.S. Census Bureau, Fewer than half of American
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households are headed by married couples. It's
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now only 47%, which is down from 71% in 1970.
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That's a massive drop in people who are set up
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to get the best out of our financial and tax
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systems. Even tougher, roughly 41% of first
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marriages end in divorce. This results in blended
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families, remarriage, and solo parenting becoming
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the norm. The system has simply just not kept
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up with the changes. And as bleak as all that
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sounds, There are real paths for single parents
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reaching for financial independence. To get there,
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we need to understand that single parents are
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playing by different rules and the standard assumptions
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don't apply. Let's take childcare, for example.
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The national average price of childcare in 2024
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was $13,128 per child per year. For a married
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couple with kids, that consumes about 10% of
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median household income. Now take a single parent,
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that jumps to 35%. So while the need for childcare
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is greater, The good news is that single working
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parents often qualify for state-level subsidies
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and federal credits that dual-income households
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miss entirely. And many states offer adjusted
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income thresholds that ease the bite when you
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know where to look. But the mileage really depends
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on the state. So how do you get the most mileage
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when the rules of the road were written for two
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drivers and we are doing it solo? Well, today's
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guest is here to help us figure that out. Pat
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Hankin is a business professional, parenting
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expert, and the author of The Field Guide for
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Single Parents. She came up not in a corner office
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or a TV studio, but inside an online community
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of nearly 500,000 single parents, where she
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became one of the most trusted voices on what
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actually works. She brings in a background in
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finance, time management, and systems thinking,
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and has spent years studying what helps parents
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stay stable, organized, and on their feet. Pat,
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welcome to Escape The Clock. Thanks, Daniel.
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I'm so glad to be here. Right up my alley. You're
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the expert. And this is actually a topic we haven't
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covered. And I think it's extremely important
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to really become a norm. I would love to start,
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though, with like the early days when you are
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online and you were seeing so many single parents
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struggling. Really curious, like what was going
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on back then and what were you really learning?
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What I was learning in the early days was a community
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of people looking to help each other out. And
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there were a lot of very common topics that kept
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coming up. The first thing that amazed me was
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that even the slightest bit of information for
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single parents was so helpful and so needed.
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A lot of people didn't get that kind of information
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when they grew up. The other thing is that it
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was astounding to me that people didn't have
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the most basic information. So a lot of what
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I talk about in terms of money, which takes up
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about a quarter of this book, obviously, is information
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that's out there already. It's just not packaged.
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were customized for single parents. And given
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their prevalence, it's kind of a national shame.
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So we're looking to fix that here. And I'm really
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glad that you're doing this. Yeah, like you said
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in your book, you really do tackle the money
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side of things. And I think that's really important.
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There was an MIT economist who studied 12 million
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Americans and found that single parents save
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substantially less for retirement than their
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married coworkers. And they receive less of employer
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matching and tax subsidies as well. So there's
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like this big disadvantage that's happened. So
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I would love to start there. Like where does
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the math break down for a single parent and what
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is the single biggest assumption like in the
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FI journey that you think might needs to change
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when it comes to being a single parent. Well,
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I think you outlined it in the beginning brilliantly,
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which is you got to know the tax code and what
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works for you and what doesn't. I'm not disheartened
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about the quote saving for retirement is lower.
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401Ks don't always make sense for a single parent.
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What they have to do is look at their effective
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tax rate with putting yourself in the head of
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household, which actually is for me a really
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great tax bracket versus a single filer. You
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expanded this. You have to look at your deductions.
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You know, the tax code has changed. since I started
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this work where the mortgage isn't the standard,
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but you get the bigger one. So I would say understanding
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your tax bracket before you jump into a lot of
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this conventional financial advice is an important
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place to start. And the biggest one for me is
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understanding whether a 401k makes sense versus
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something like a Roth or paying down your mortgage.
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I think these things are, people want to go in
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these standard steps and it doesn't always work.
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Right, yeah. That makes a lot of sense. And I
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wonder how much expense management comes in because
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the expenses can really stack for a single parent.
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Yeah. And really doing this just on like usually
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one income. Yes. What types of things should
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they be thinking about when it comes to all the
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costs and things that are in their life? The
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thing in terms of the cost is you're going to
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not get what the Joneses get. And I have news
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for single parents listening to the shows. A
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lot of times those Joneses are liars anyway.
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So Don't try it. The three things and the mirror
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price had done this study probably 15 years ago.
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I'm sure it still holds the three things that
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are the biggest expenses for single parents are
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housing or any parent actually is housing vacation
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and education. So before you start cutting out
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your lattes, let's drill on those big expenses.
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I'm not going to tell you to cut out your lattes.
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Maybe I'll tell you to cut out buying lunch every
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day. for your health. But in other words, if
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you take those three broad categories of your
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housing costs, your vacation costs and your education
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costs and you start looking at the different
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levers you can push, you will have a much bigger
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impact on your spend than you will if you start
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clipping coupons. Drive me insane when I see
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those sites. Please, people don't look at those
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anymore. What about outside of doing those types
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of hygiene, do single parents typically miss?
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Like are there advantages, programs, other things
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that you typically like people up to that they
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should be considering? Yeah, and you actually
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touched on this in the beginning, which is the
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local and the state programs. And yes, your mileage
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may vary on those. There is no federal policy
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for families. I mean, we had universal income
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during COVID. People really talked about it,
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putting a floor under them. And then we all know
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what happened in the last couple of years as
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far as what that went. But if you start looking
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at your everyday expenses and the things that
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you spend money on for kids with regards to everything
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from tutoring for special needs to summer camp,
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there are a lot of different programs that exist,
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either they're free or they're on a sliding scale.
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And like I said in the beginning, understanding
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the information that's out there is usually the
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biggest barrier for people. And then the time
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to research them. And I talk a lot about using
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people who want to help you, but making sure
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it's time limited and nobody's got. a whole lot
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of time these days. And it's a good helper, you
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know, help me figure out what programs are available
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for me. Utilities have them. School has them.
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The Y's have them. Everybody's got it. And you
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can look at the sliding scale. I think a lot
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of time can feel alone. Doing the single parenting
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thing and getting help from the community or
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from others can help. And sometimes maybe people
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miss. There's no gift exception limits for gifting
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to tuition. If you have people helping and want
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to support you. They can actually give as much
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money as they want directly to the tuition of
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your kid. There's no limit that you have to worry
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about. There's like little things like that.
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And they add up. Yeah, for sure. I'd like to
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talk about single mothers for a moment. You've
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worked in the community, you've seen and supported
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a lot of this and particularly single mother
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homeowners typically hold less equity. There
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was this Pew Research Center analysis that happened
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where they showed that 34% of single mothers
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own their own home compared to 47% of single
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men. 50% of single women without children. So
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it's like once you're a single mom, it's like
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it just, it gets even harder. And so I'm curious
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like what you've learned and how you've been
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able to support mothers when it seems like it's
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even more difficult in that situation. Generally,
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it's age-based. If you're pretty new on the
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homeownership journey, then you're gonna have
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less equity in a home than if you've had a home
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for 10, 15 years. And I think getting the equity
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in the home, as you said, is important. I referenced
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before we got on the show one of the guests we
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had on previously about accessing the equity
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in your home. This, for me personally, was something
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I did extensively. I worked in financial services.
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There was a period of consolidation. It was pretty
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clear I was going to lose my job. And I was 50
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by the time that happened. So it was pretty clear
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it was going to be a while before I got a next
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one given my age. So I went out and took out
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the biggest loan that they would approve me for
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in terms of a home equity line of credit. And
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that sort of smooths out the hills and valleys
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of your income going over the years. For single
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moms not to have as much in their home equity,
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at least they have it. That's what I can say.
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You have it. It can be a backup. I do not at
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all advocate using it to go on a vacation to
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Disney. In fact, I'm saying don't go ever on
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a vacation to Disney. Wait until you're old enough
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your kid won't remember it anyway. Let your ex
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take them. It's really hot. There's a lot better
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ways to do it and build memories with your kids.
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But what you're talking about is having a series
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of backup finances available to you. And it's
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also one of those questions about do you buy
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or rent? This is something you have to work out
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if you're breaking up a household. You have far
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less chance of your qualifying for a new mortgage.
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Therefore, you might want to think about fixing
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this before you sign any dissolution papers because
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you probably can't hold on to this big house
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after your divorce, which is the biggest transition
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that I see most women have problems with, which
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is, well, I don't want to upset my kids. Well,
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they're already upset. They're going to be more
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upset when you're stressed out about maintaining
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this giant house. with that advice has to come,
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you're going to have to deal with this before
00:13:04.080 --> 00:13:07.220
you sign the papers. Because getting a new house
00:13:07.220 --> 00:13:09.799
after you've divorced is extremely difficult.
00:13:10.100 --> 00:13:12.820
One, in this market and two, with the income
00:13:12.820 --> 00:13:15.500
level that you have on your own and you can report.
00:13:16.240 --> 00:13:19.460
Here's what you think about this idea. In a previous
00:13:19.460 --> 00:13:22.299
episode, we had Annamarie Pluhar. She wrote
00:13:22.299 --> 00:13:27.019
a book about co-housing. Okay. And she, in particular,
00:13:27.360 --> 00:13:29.340
was talking about the strategy of single parents
00:13:29.340 --> 00:13:32.519
cohabitating. and how it got the extra set of
00:13:32.519 --> 00:13:35.960
hands and can become kind of like a family. Yeah.
00:13:36.240 --> 00:13:38.559
Have you seen that kind of thing happen? Is that
00:13:38.559 --> 00:13:40.600
a strategy you think could be effective? Yes,
00:13:40.600 --> 00:13:42.700
I have. In fact, there's one right down the road
00:13:42.700 --> 00:13:45.019
for me here. One of the first ones that was done.
00:13:45.159 --> 00:13:48.220
It depends on who you are as a person and your
00:13:48.220 --> 00:13:51.659
personality to be able to collaborate with people
00:13:51.659 --> 00:13:53.779
because it can't be everyone takes care of your
00:13:53.779 --> 00:13:55.379
kid, but you don't take care of their kids kind
00:13:55.379 --> 00:13:57.399
of thing. If you're a kind of person that doesn't
00:13:57.399 --> 00:14:02.929
keep score. That's a brilliant suggestion, and
00:14:02.929 --> 00:14:06.110
it was recommended a number of times in the community
00:14:06.110 --> 00:14:09.009
that people look into it. I've seen some of them
00:14:09.009 --> 00:14:11.529
in the western part of Massachusetts where I
00:14:11.529 --> 00:14:13.629
live. There's a five-college area out there.
00:14:13.649 --> 00:14:16.090
I guess it's now four colleges that you can look
00:14:16.090 --> 00:14:19.429
at. But those kind of strategies is to look at
00:14:19.429 --> 00:14:22.269
joining up with other families, pooling assets.
00:14:22.509 --> 00:14:25.429
These are all very legitimate. But again, it's
00:14:25.429 --> 00:14:28.220
going to depend on your... personality and how
00:14:28.220 --> 00:14:30.460
you do, do you play well with others, right?
00:14:30.679 --> 00:14:33.419
You're going to know that. I want to touch on
00:14:33.419 --> 00:14:36.039
the time and mental bandwidth pieces because
00:14:36.039 --> 00:14:37.659
for a single parent, they're doing the work too.
00:14:37.860 --> 00:14:41.559
There's this time tax, cognitive load tax, all
00:14:41.559 --> 00:14:43.919
these things. And sometimes just thinking about
00:14:43.919 --> 00:14:46.840
money can just maybe feel like distress. Yeah.
00:14:47.019 --> 00:14:49.440
Maybe it's easier to avoid it. So I was wondering
00:14:49.440 --> 00:14:52.299
like how you've seen people dig in when it comes
00:14:52.299 --> 00:14:54.700
to the real cost of carrying this large mental
00:14:54.700 --> 00:14:56.679
load and knowing that you have to educate yourself
00:14:56.679 --> 00:14:59.070
in so many areas. There's some people I've seen,
00:14:59.210 --> 00:15:01.730
they just go for it. They just like head down
00:15:01.730 --> 00:15:04.110
and go. Other people are like, where do I start?
00:15:04.470 --> 00:15:07.090
What I found is one, if you don't know your basic
00:15:07.090 --> 00:15:09.690
numbers before you start all this and you're
00:15:09.690 --> 00:15:11.529
avoiding it, you're going to have a much tougher
00:15:11.529 --> 00:15:14.009
road on this one. Knowing what's coming in and
00:15:14.009 --> 00:15:16.269
what's going out. And then the trade off with
00:15:16.269 --> 00:15:18.250
time is very legitimate. I'm glad you brought
00:15:18.250 --> 00:15:21.330
this up because most people don't know the value
00:15:21.330 --> 00:15:23.809
of their time. In other words, what are they
00:15:23.809 --> 00:15:26.649
really making per hour after the cost to go to
00:15:26.649 --> 00:15:29.519
work, et cetera. et cetera, and then look at,
00:15:29.519 --> 00:15:32.990
can you? outsource or hire help that financially
00:15:32.990 --> 00:15:35.970
costs less than you're working to pay for them.
00:15:36.230 --> 00:15:39.870
And it will take away a lot of the decision factors.
00:15:40.090 --> 00:15:42.730
And the biggest gains I see for people is getting
00:15:42.730 --> 00:15:45.250
somebody to clean your home, right? Whether you're
00:15:45.250 --> 00:15:47.590
going to have your groceries delivered or you're
00:15:47.590 --> 00:15:49.429
going to go take two or three hours to go to
00:15:49.429 --> 00:15:51.330
the store, go get them, bring them back, deal
00:15:51.330 --> 00:15:53.230
with the kids. So there are a lot of these things
00:15:53.230 --> 00:15:55.429
where you will find that probably when you do
00:15:55.429 --> 00:15:57.850
this analysis for yourself, it makes more sense
00:15:57.850 --> 00:16:00.600
to get help. than not. And doing everything yourself
00:16:00.600 --> 00:16:03.600
is really, really important. Another solution
00:16:03.600 --> 00:16:06.340
I've seen when we talked about the housing is
00:16:06.340 --> 00:16:09.980
property managing. So living in a property where
00:16:09.980 --> 00:16:12.460
people are absent and you're there taking care
00:16:12.460 --> 00:16:15.720
of the property for them, that's a non-monetary,
00:16:15.720 --> 00:16:18.860
monetary trade-off that can be worthwhile for
00:16:18.860 --> 00:16:21.519
you, depending on where your kids are, how old
00:16:21.519 --> 00:16:24.350
they are, et cetera. It's like you can kind of
00:16:24.350 --> 00:16:27.110
design your life a bit to like build delegation
00:16:27.110 --> 00:16:29.730
and in these different areas in a way to take
00:16:29.730 --> 00:16:32.309
some of that load off yourself. Yeah. I wonder
00:16:32.309 --> 00:16:33.970
about the listener, though, who feels like they
00:16:33.970 --> 00:16:36.509
can't even find an hour to even think about money.
00:16:36.669 --> 00:16:38.289
How do you help that person get through that
00:16:38.289 --> 00:16:41.649
block? Yeah, don't think in terms of hours. So
00:16:41.649 --> 00:16:44.750
we talk a lot about the 15 minute parent. You
00:16:44.750 --> 00:16:46.950
know, remember the 15 minute manager that was
00:16:46.950 --> 00:16:50.289
out there back in the day? Well, I'm for the
00:16:50.289 --> 00:16:53.750
15 minute parent. And that is don't do anything
00:16:53.750 --> 00:16:55.590
more than it's going to take you 15 minutes.
00:16:55.610 --> 00:16:57.629
Sometimes it's just looking up the phone number
00:16:57.629 --> 00:16:59.750
of somebody that's going to help you. Sometimes
00:16:59.750 --> 00:17:02.750
it's just cruising through your online banking's
00:17:02.750 --> 00:17:05.960
website. We'll have basic budgeting things on
00:17:05.960 --> 00:17:08.759
there. There are organizations that actually
00:17:08.759 --> 00:17:11.900
will be your budgeting buddy. It used to be called
00:17:11.900 --> 00:17:13.819
Budget Buddies. Now I think it's called Women
00:17:13.819 --> 00:17:16.140
Money Matters. They might take men in there now
00:17:16.140 --> 00:17:20.059
too. There are lots of ways that you can get
00:17:20.059 --> 00:17:22.700
financial coaching and there's a term for this.
00:17:22.819 --> 00:17:25.539
It's called body doubling. I think it's a psychological
00:17:25.539 --> 00:17:28.140
term where you actually sit side by side with
00:17:28.140 --> 00:17:30.680
someone where you've got this paper bag full
00:17:30.680 --> 00:17:34.099
of paper, school forms, budgets, bills, whatever.
00:17:34.380 --> 00:17:36.640
And you work on yours while they work on theirs.
00:17:37.000 --> 00:17:40.519
OK. And you get a lot of psychological uplift
00:17:40.519 --> 00:17:43.039
by, you know, it's somebody who keeps you accountable
00:17:43.039 --> 00:17:45.880
to sit there for the 15 minutes or an hour. Yeah,
00:17:45.940 --> 00:17:48.880
this isn't bad. But my spouse has a physical
00:17:48.880 --> 00:17:51.079
weight goal and wants to get active, go to the
00:17:51.079 --> 00:17:52.680
gym. And as a friend, she's trying to do the
00:17:52.680 --> 00:17:54.220
same. She's had a membership she hasn't used
00:17:54.220 --> 00:17:57.079
in years, been paying and never uses it. So they're
00:17:57.079 --> 00:18:01.309
helping. by forcing each other to go. It's working
00:18:01.309 --> 00:18:03.309
and it's working and they get more out of it
00:18:03.309 --> 00:18:04.950
because they're spending time together and you
00:18:04.950 --> 00:18:06.730
see someone else is not, you're not suffering
00:18:06.730 --> 00:18:09.809
alone. I think that's part of it. Suffering alone.
00:18:09.990 --> 00:18:12.109
I think just it's, it's, it's almost easier to
00:18:12.109 --> 00:18:14.630
just avoid it. Right. Cause it's like, you talk
00:18:14.630 --> 00:18:18.109
yourself out of it. And expand your vision to
00:18:18.109 --> 00:18:20.029
include people you wouldn't think about. It can
00:18:20.029 --> 00:18:22.650
be an elder that would really like the company
00:18:22.650 --> 00:18:24.829
for you to sit there and they sit there. It could
00:18:24.829 --> 00:18:27.210
be someone if you go to a church. I think what
00:18:27.210 --> 00:18:29.549
happens is a lot of people look for someone exactly
00:18:29.549 --> 00:18:32.470
their age in their space and that's hard to find
00:18:32.470 --> 00:18:35.750
sometimes, right? So be able to look down younger
00:18:35.750 --> 00:18:39.109
people. I have a 21 year old that comes and talks
00:18:39.109 --> 00:18:40.829
to me because she just wants to talk through
00:18:40.829 --> 00:18:43.309
things. I wanted to make sure we touched on retirement
00:18:43.309 --> 00:18:47.230
planning. single parents can feel like they just
00:18:47.230 --> 00:18:49.690
can't even afford to do it. Or even in a lot
00:18:49.690 --> 00:18:53.309
of cases, sadly, employer plans don't offer the
00:18:53.309 --> 00:18:56.269
single parents the same access to contributions
00:18:56.269 --> 00:18:58.910
and enrollment that I think others see. Really?
00:18:59.150 --> 00:19:01.430
Yeah. There's another Pew report that said that
00:19:01.430 --> 00:19:03.329
more than 50 million American workers don't have
00:19:03.329 --> 00:19:05.730
access to a workplace retirement savings plan,
00:19:05.950 --> 00:19:08.089
especially lower income and single parent households
00:19:08.089 --> 00:19:09.809
that are disproportionately represented in the
00:19:09.809 --> 00:19:12.690
group. And so with these barriers and sometimes
00:19:12.690 --> 00:19:14.509
just feeling like you just can't even afford
00:19:14.619 --> 00:19:17.680
to even take a match. Like I think sometimes
00:19:17.680 --> 00:19:19.559
people just don't feel like they have the money
00:19:19.559 --> 00:19:22.099
to spend on these things. Retirement is a big
00:19:22.099 --> 00:19:24.259
issue in the United States. Like there's a lack
00:19:24.259 --> 00:19:26.539
of retirement savings in general. And I think
00:19:26.539 --> 00:19:28.779
single parents who might feel like they're in
00:19:28.779 --> 00:19:31.339
a kind of a survival mode, I feel like there's
00:19:31.339 --> 00:19:33.839
no ability to get any leverage anywhere without
00:19:33.839 --> 00:19:36.099
a partner to help share that load. What types
00:19:36.099 --> 00:19:38.960
of things can they do to have any shot at a future
00:19:38.960 --> 00:19:42.089
stability of a retirement? And do that along
00:19:42.089 --> 00:19:45.170
with planning your kid's education and your own
00:19:45.170 --> 00:19:48.769
things, right? I think you should do it all at
00:19:48.769 --> 00:19:51.910
once with smaller amounts. Less around anything
00:19:51.910 --> 00:19:54.589
else other than the psychological lift you get
00:19:54.589 --> 00:19:56.829
from watching a savings account grow, whether
00:19:56.829 --> 00:20:01.309
it's $25 a month or $100 a month, and automating
00:20:01.309 --> 00:20:04.609
that. And don't worry about the long-term retirement
00:20:04.609 --> 00:20:06.869
thing, which is turning into a giant tax bomb
00:20:06.869 --> 00:20:09.450
anyway for people. I'm not sure what matches
00:20:09.450 --> 00:20:13.680
are there. days is like, you know, it's kind
00:20:13.680 --> 00:20:16.220
of nice, but I wouldn't structure my retirement
00:20:16.220 --> 00:20:19.380
plan. The thing for people who are feeling really,
00:20:19.380 --> 00:20:22.619
really pressured is to start small and to start
00:20:22.619 --> 00:20:25.579
talking to people. Your bank will give you a
00:20:25.579 --> 00:20:29.250
banker to talk to. Yeah. Your employer, and this
00:20:29.250 --> 00:20:31.269
is something I pushed for years when I was in
00:20:31.269 --> 00:20:34.529
the corporate workplace, you can ask your employer
00:20:34.529 --> 00:20:38.690
that the 401k asset manager they have, like let's
00:20:38.690 --> 00:20:41.730
say it's TIAA-CREF, which is for teachers mostly,
00:20:41.869 --> 00:20:44.609
great firm, ask them to bring in someone to talk
00:20:44.609 --> 00:20:47.569
about this specific issue. You can be the change
00:20:47.569 --> 00:20:51.049
with your employer. And like anything else for
00:20:51.049 --> 00:20:53.410
people going through this, nothing's forever.
00:20:53.690 --> 00:20:56.670
Your kids do grow up and become responsible.
00:20:56.910 --> 00:20:59.650
which is the biggest advantage that single parents
00:20:59.650 --> 00:21:02.190
have, is they can't afford to coddle their kids.
00:21:02.309 --> 00:21:04.289
They don't have the bandwidth. And those kids
00:21:04.289 --> 00:21:06.009
sometimes turn around to come back and support
00:21:06.009 --> 00:21:08.750
them? Sometimes, yeah. I'm still waiting on that,
00:21:08.990 --> 00:21:13.210
but my daughter's a scientist, which means we
00:21:13.210 --> 00:21:17.200
might not have. But these things, it's one step
00:21:17.200 --> 00:21:20.240
at a time and it's small. And if you don't let
00:21:20.240 --> 00:21:23.000
the size of this overwhelm it, we break it down
00:21:23.000 --> 00:21:25.259
to 15 minutes. Sometimes it's just writing the
00:21:25.259 --> 00:21:29.160
number down of your 401k or HR person and put
00:21:29.160 --> 00:21:32.440
it there. Actually, if you have an HR department
00:21:32.440 --> 00:21:35.829
that's actually responsive to employees. I'd
00:21:35.829 --> 00:21:38.289
say they probably are looking for ideas. Well,
00:21:38.329 --> 00:21:39.750
Pat, I was actually going to ask you that directly.
00:21:40.069 --> 00:21:42.509
Like, do you think it's a good idea for single
00:21:42.509 --> 00:21:45.430
parents to disclose to their employer or HR or
00:21:45.430 --> 00:21:47.869
whoever their situation and just ask for? Yes,
00:21:48.289 --> 00:21:50.619
as long as you're not whining. Everybody's got
00:21:50.619 --> 00:21:52.920
parents. Everybody's got problems. Nobody gets
00:21:52.920 --> 00:21:56.019
anywhere with whining. But I would just not disclose
00:21:56.019 --> 00:21:58.480
it before you're hired. I do not. There is a
00:21:58.480 --> 00:22:00.839
lot of stigma on this issue. But once you're
00:22:00.839 --> 00:22:03.279
there, they're invested. I remember there was
00:22:03.279 --> 00:22:06.359
one employer, I was with PwC Consulting. They
00:22:06.359 --> 00:22:08.319
sent me around the world. And this was in the
00:22:08.319 --> 00:22:10.259
days where we still had to wear suits. And I
00:22:10.259 --> 00:22:12.480
went in and said, when we're on the bench, that
00:22:12.480 --> 00:22:14.160
means you're in the office, you're not off at
00:22:14.160 --> 00:22:16.599
some client's site. Why don't you just tell people
00:22:16.599 --> 00:22:18.480
they don't have to wear these suits anymore?
00:22:18.799 --> 00:22:21.240
to raise, because we don't have to clean them
00:22:21.240 --> 00:22:24.140
all the time. And it's not going to cost you
00:22:24.140 --> 00:22:26.460
anything. And there's a series of things. Think
00:22:26.460 --> 00:22:29.380
about those things, because working for an employer,
00:22:29.819 --> 00:22:32.400
it's a mutually social compact. Right? I'm going
00:22:32.400 --> 00:22:34.960
back to Jean-Jacques Rousseau in the 18th century,
00:22:35.319 --> 00:22:38.500
right? So, you know, they want you. Single parents
00:22:38.500 --> 00:22:41.940
are the most resourceful, creative and collaborative
00:22:41.940 --> 00:22:44.700
kind of people. And they need you and they want
00:22:44.700 --> 00:22:47.519
you. Realize that and go in and say, here's an
00:22:47.519 --> 00:22:49.839
idea I had that could help not just single parents,
00:22:50.019 --> 00:22:52.900
but all parents. Love that. I was hoping we could,
00:22:52.940 --> 00:22:55.480
before we wrap up, talk about what does work
00:22:55.480 --> 00:22:57.460
optional mean for a single parent, because it
00:22:57.460 --> 00:23:00.589
might not be the same. for a baby married person.
00:23:00.890 --> 00:23:03.529
Because like in my case, I was able to retire
00:23:03.529 --> 00:23:05.509
early, but my wife, she could have as well, but
00:23:05.509 --> 00:23:07.410
she chose to work. She wants to. It's fine. That's
00:23:07.410 --> 00:23:09.690
no problem. But that's just because we have a
00:23:09.690 --> 00:23:11.269
different option than maybe a single parent has.
00:23:11.470 --> 00:23:13.750
So I do wonder what it means to be work optional
00:23:13.750 --> 00:23:15.910
or financially free for a single parent. Maybe
00:23:15.910 --> 00:23:18.109
it just means being more present with kids. Maybe
00:23:18.109 --> 00:23:19.529
it just means being able to take more breaks.
00:23:19.690 --> 00:23:22.000
I don't know. How do you see it? It's very true.
00:23:22.059 --> 00:23:24.779
You can go visit them where they are or yes,
00:23:24.779 --> 00:23:28.259
that's work optional. I'm a big believer in five
00:23:28.259 --> 00:23:30.119
streams of income and that doesn't mean five
00:23:30.119 --> 00:23:32.599
separate jobs. Did you talk about that in your
00:23:32.599 --> 00:23:35.259
show? Yeah, lots of building up your supplemental
00:23:35.259 --> 00:23:37.599
income streams, being able to place a paycheck,
00:23:37.859 --> 00:23:39.599
all that type of stuff. Yeah. Right. It could
00:23:39.599 --> 00:23:43.339
be selling things on eBay. It could be investing
00:23:43.339 --> 00:23:45.880
and gaining the interest and dividends on it.
00:23:45.940 --> 00:23:49.599
It can be a W-2. It could be a 1099 in taking
00:23:49.599 --> 00:23:52.220
what you have and working as a contractor, different
00:23:52.220 --> 00:23:55.359
places. So work optional for a single parent
00:23:55.359 --> 00:23:58.519
is a great goal. It may take longer and it may
00:23:58.519 --> 00:24:00.799
be something you don't like because some people
00:24:00.799 --> 00:24:02.980
like working, they find their identity in it.
00:24:03.480 --> 00:24:05.759
But you can look at one of the things is the
00:24:05.759 --> 00:24:08.720
pace and change in work has been so different
00:24:08.720 --> 00:24:11.400
these last five years, six years now since the
00:24:11.400 --> 00:24:13.960
pandemic that I think you have a lot more options
00:24:13.960 --> 00:24:17.019
open with him. I will say. When you're starting
00:24:17.019 --> 00:24:19.960
out though, I do have a question about whether
00:24:19.960 --> 00:24:22.859
remote work is the best thing for a single parent.
00:24:23.440 --> 00:24:25.900
Interesting. Yeah, I think you're better off
00:24:25.900 --> 00:24:28.319
getting in there and getting to know them and
00:24:28.319 --> 00:24:31.440
having them know you before you become a faceless
00:24:31.440 --> 00:24:33.980
voice on the phone. If you can swing it, that's
00:24:33.980 --> 00:24:35.920
fine. You can't be minding your kids while you're
00:24:35.920 --> 00:24:38.279
around remote work anyway. Most employers won't
00:24:38.279 --> 00:24:41.460
let you do that. So as far as getting the experience
00:24:41.460 --> 00:24:43.539
on both of those, I think it's very helpful when
00:24:43.539 --> 00:24:47.039
you think about later on in terms of FI. I think
00:24:47.039 --> 00:24:50.220
it's a feeling of safety that you have your emergency
00:24:50.220 --> 00:24:53.880
funds built up. You may find yourself involuntarily
00:24:53.880 --> 00:24:58.359
on work optional. And you've got to work through
00:24:58.359 --> 00:25:01.059
that, you know? We talked about for myself when
00:25:01.059 --> 00:25:03.519
I had those years that I didn't work, I've been
00:25:03.519 --> 00:25:05.759
over-employed, underemployed, and unemployed.
00:25:06.039 --> 00:25:08.240
And it happens to everyone. And I think it's
00:25:08.240 --> 00:25:10.740
important for people to realize that if it happens
00:25:10.740 --> 00:25:14.269
to you, you will get through it. So that I'm
00:25:14.269 --> 00:25:16.470
wondering for the single parents who are listening
00:25:16.470 --> 00:25:20.589
and they are trying to get organized They're
00:25:20.589 --> 00:25:23.190
really interested and making the most situation
00:25:23.190 --> 00:25:26.029
and what is the one thing you want them to hear
00:25:26.029 --> 00:25:28.450
today? If you could tell them talk to all of
00:25:28.450 --> 00:25:30.789
them directly. Well, I want to tell them that
00:25:30.789 --> 00:25:33.740
they are amazing people first of all Everybody's
00:25:33.740 --> 00:25:36.380
going to be in awe of your ability to do this.
00:25:36.539 --> 00:25:38.660
And no, it's not easy. I won't tell you it's
00:25:38.660 --> 00:25:41.279
easy, but I will tell you that if you take it
00:25:41.279 --> 00:25:44.579
slow, 15 minute increments, nothing gets done
00:25:44.579 --> 00:25:48.259
without the trinity of exercise, nutrition, and
00:25:48.259 --> 00:25:53.099
sleep. With that, sleep cures everything, right?
00:25:53.420 --> 00:25:56.299
Not everything can get done in one day. Personally,
00:25:56.500 --> 00:25:58.799
other than work, I can maybe manage five things,
00:25:58.859 --> 00:26:02.140
and that includes taking out the trash. So shrink
00:26:02.140 --> 00:26:04.099
your world down, it'll become more manageable.
00:26:04.559 --> 00:26:07.279
And know your numbers. Know your numbers and
00:26:07.279 --> 00:26:09.680
there's no shame in this. A big thing with single
00:26:09.680 --> 00:26:12.420
parents that holds them back is fear and shame.
00:26:12.839 --> 00:26:15.200
And fear constricts down what they're going to
00:26:15.200 --> 00:26:17.940
do financially. And I'm here to tell you, it
00:26:17.940 --> 00:26:20.619
is all manageable as long as you get a guide
00:26:20.619 --> 00:26:23.099
to take you through this step by step. And sometimes
00:26:23.099 --> 00:26:25.519
you get that nice accountability buddy next to
00:26:25.519 --> 00:26:27.720
you. Yeah, and you get support out there for
00:26:27.720 --> 00:26:29.900
sure. You start looking for it. Well, this has
00:26:29.900 --> 00:26:32.740
been such a useful conversation. I really appreciate
00:26:32.740 --> 00:26:34.720
you coming on, sharing all your expertise with
00:26:34.720 --> 00:26:37.839
us. How can listeners connect with you and also
00:26:37.839 --> 00:26:40.059
get your book, The Field Guide for Single Parents.
00:26:40.819 --> 00:26:44.200
The website is Pat Hankin. My name is spelled
00:26:44.200 --> 00:26:47.220
exactly as it sounds, H-A-N-K-I-N, pathankin
00:26:47.220 --> 00:26:49.829
.com. There are all sorts of principles for a
00:26:49.829 --> 00:26:51.650
lot of the things we talked about, knowing the
00:26:51.650 --> 00:26:54.069
value of your time, breaking down your budget,
00:26:54.329 --> 00:26:56.670
how to take your kids on vacation for no money.
00:26:58.329 --> 00:27:03.690
We don't talk enough about having fun with your
00:27:03.690 --> 00:27:06.490
kids. So I liked to do that with the book and
00:27:06.490 --> 00:27:08.839
with the people in the community. And the book
00:27:08.839 --> 00:27:11.119
is the field guide for single parents. If you
00:27:11.119 --> 00:27:13.319
don't want to go into a bookstore and order it,
00:27:13.599 --> 00:27:15.920
you can go to your public library and order it.
00:27:15.940 --> 00:27:18.829
They will get it for you. It's now in 10%. of
00:27:18.829 --> 00:27:21.730
the bookstores in America. And you can also get
00:27:21.730 --> 00:27:23.670
it online, obviously, with Amazon. If you've
00:27:23.670 --> 00:27:27.150
got to have it tomorrow, they'll deliver it.
00:27:27.170 --> 00:27:29.549
And it's meant to be written in big wide margins
00:27:29.549 --> 00:27:31.509
on it. Don't write in the library book, though,
00:27:31.569 --> 00:27:33.710
OK? And they don't like that. But you can see
00:27:33.710 --> 00:27:36.450
this book has big margins and big space that
00:27:36.450 --> 00:27:38.809
you can write in and take notes. And it's meant
00:27:38.809 --> 00:27:41.609
to be dipped into as you need be, because not
00:27:41.609 --> 00:27:44.849
every topic is going to be interesting to everybody.
00:27:45.119 --> 00:27:47.099
So your journey is your journey and your guide
00:27:47.099 --> 00:27:49.240
might be a little different. Right. And if you
00:27:49.240 --> 00:27:50.920
send me an email through the website, I will
00:27:50.920 --> 00:27:53.759
get it to monitor its mailbox. But I really wish
00:27:53.759 --> 00:27:55.519
everyone the best of luck on their journeys.
00:27:55.519 --> 00:27:58.720
And I know this is going to come out OK for you.
00:27:58.960 --> 00:28:00.819
Lovely. Well, thanks again, Pat. I really appreciate
00:28:00.819 --> 00:28:03.960
you being on the show. My pleasure. Thank you.
00:28:12.680 --> 00:28:15.880
Cut the latte, clip the coupon. cancel that subscription
00:28:15.880 --> 00:28:17.940
that you forgot you were paying. This is the
00:28:17.940 --> 00:28:20.420
financial advice that so many of us grew up on,
00:28:20.740 --> 00:28:23.140
and it does have a certain logic, because small
00:28:23.140 --> 00:28:26.259
leaks sink big ships. But without knowing the
00:28:26.259 --> 00:28:28.660
value of our time, how do we even know which
00:28:28.660 --> 00:28:31.839
leaks are worth plugging? I learned this myself
00:28:31.839 --> 00:28:34.279
the hard way. I remember having a paper route
00:28:34.279 --> 00:28:37.339
as a kid. I'd get up at 4am to bag all the papers
00:28:37.339 --> 00:28:39.480
by 5, so that I could have them on the doorsteps
00:28:39.480 --> 00:28:42.410
by 6, so I could make the bus by 7. That was
00:28:42.410 --> 00:28:45.329
about three hours of work once a week for a little
00:28:45.329 --> 00:28:47.869
under $50 a month. And I was proud of earning
00:28:47.869 --> 00:28:50.769
that money. But after all those times walking
00:28:50.769 --> 00:28:53.210
that route in the dark, never did I calculate
00:28:53.210 --> 00:28:55.950
the hourly rate. I just knew I'd have money to
00:28:55.950 --> 00:28:58.349
spend at the end of the month. Now, as an adult,
00:28:58.410 --> 00:29:01.269
I finally did that calculation and it was around
00:29:01.269 --> 00:29:05.109
$4.10 an hour. The minimum wage for a minor
00:29:05.109 --> 00:29:08.920
in Ohio back then was $4.25. So I was making
00:29:08.920 --> 00:29:11.940
less than minimum wage, doing work harder than
00:29:11.940 --> 00:29:13.619
a lot of my peers who were actually earning a
00:29:13.619 --> 00:29:16.599
lot more. So the wage was terrible, but my time
00:29:16.599 --> 00:29:18.700
was plentiful back then, and honestly it just
00:29:18.700 --> 00:29:20.960
seemed worth it, and I kept at it for months,
00:29:21.539 --> 00:29:23.259
until I could finally afford to buy my mother
00:29:23.259 --> 00:29:25.940
a dishwasher. The one in her apartment had broken,
00:29:26.160 --> 00:29:27.539
and my father said he didn't have the money to
00:29:27.539 --> 00:29:30.240
fix it. She hated how much work it was, cooking
00:29:30.240 --> 00:29:32.920
and doing dishes for a family of five, especially
00:29:32.920 --> 00:29:35.099
with three hungry boys in the house. To this
00:29:35.099 --> 00:29:37.259
day, I still remember the joy on her face when
00:29:37.259 --> 00:29:39.619
she got that dishwasher. It's something I'm never
00:29:39.619 --> 00:29:42.440
going to forget. My experience is not unique
00:29:42.440 --> 00:29:46.579
here. So many of us are in a survival mode, trying
00:29:46.579 --> 00:29:48.599
to make enough for ourselves and those that we
00:29:48.599 --> 00:29:51.019
care about, just doing whatever we can to get
00:29:51.019 --> 00:29:54.160
by. And when you're in that mode, you don't calculate
00:29:54.160 --> 00:29:56.480
the value of an hour. You just work the hours
00:29:56.480 --> 00:29:58.660
as they come to you. The problem is that the
00:29:58.660 --> 00:30:01.380
stakes get higher as we get older. That actually
00:30:01.380 --> 00:30:04.420
ends up making our hours more valuable. and that
00:30:04.420 --> 00:30:07.319
blind spot can get pretty costly. And that's
00:30:07.319 --> 00:30:09.720
where the system really ends up letting people
00:30:09.720 --> 00:30:12.420
down, because it's built assuming that you'll
00:30:12.420 --> 00:30:14.960
eventually have a teammate, someone else to carry
00:30:14.960 --> 00:30:18.059
the load. Pat Hankin said it well. She said,
00:30:18.079 --> 00:30:20.359
almost nobody understands the cost of their time
00:30:20.359 --> 00:30:22.559
and least of all the people raising kids alone.
00:30:22.960 --> 00:30:25.079
So I want to hand you an important calculation
00:30:25.079 --> 00:30:28.240
that can help you figure out your plan. And it
00:30:28.240 --> 00:30:30.480
takes about 10 minutes to do this, but it can
00:30:30.480 --> 00:30:33.190
make a big difference. First, You have to figure
00:30:33.190 --> 00:30:35.470
out what your current take home pay is. This
00:30:35.470 --> 00:30:37.690
isn't your salary. This is the actual money that
00:30:37.690 --> 00:30:39.769
you see deposited each month. It just takes a
00:30:39.769 --> 00:30:41.910
minute to figure this number out. Now, you're
00:30:41.910 --> 00:30:45.069
going to subtract what it cost you to earn that
00:30:45.069 --> 00:30:47.410
amount. To do this, you're going to have to think
00:30:47.410 --> 00:30:49.869
about your week. How much did you end up spending
00:30:49.869 --> 00:30:54.029
on gas, on parking, child care, even clothes
00:30:54.029 --> 00:30:56.210
that you ended up buying because of your job?
00:30:56.670 --> 00:30:58.990
How about food that you ended up paying for because
00:30:58.990 --> 00:31:01.880
you didn't have time to pack that day? or a surprise
00:31:01.880 --> 00:31:04.460
car repair because you had to get yourself to
00:31:04.460 --> 00:31:07.559
and from work. Now add up all those hours. Not
00:31:07.559 --> 00:31:08.880
just the ones you were officially on the clock,
00:31:08.960 --> 00:31:11.539
all of them. Don't hold back here. Consider your
00:31:11.539 --> 00:31:13.720
commute, the time you spent getting ready in
00:31:13.720 --> 00:31:16.700
the morning, the 45 minutes after you get home
00:31:16.700 --> 00:31:18.339
and you're still decompressing and even useless
00:31:18.339 --> 00:31:20.519
to everyone in the house. And when you're done,
00:31:20.519 --> 00:31:21.980
you're going to have just those two numbers.
00:31:22.559 --> 00:31:24.259
The money that you actually kept at the end of
00:31:24.259 --> 00:31:26.880
the month and the time it actually cost you.
00:31:27.259 --> 00:31:29.240
And you divide them together. Divide the first
00:31:29.240 --> 00:31:32.369
by the second. And there it is. That is what
00:31:32.369 --> 00:31:36.009
your time is genuinely worth. Now, let me put
00:31:36.009 --> 00:31:38.269
real numbers on that because the gap is actually
00:31:38.269 --> 00:31:41.809
a lot bigger than people expect. Two women, same
00:31:41.809 --> 00:31:44.329
job, same company. They sit next to each other.
00:31:44.390 --> 00:31:47.109
They're both earning $60,000 a year. Now, if
00:31:47.109 --> 00:31:50.470
you look at that salary on paper, they're supposedly
00:31:50.470 --> 00:31:54.069
earning $28 an hour. The first woman is married.
00:31:54.369 --> 00:31:57.369
Her take home lands around $4,000 a month. Getting
00:31:57.369 --> 00:32:00.789
to work is costing her $320, and that's spent
00:32:00.789 --> 00:32:03.609
on things like gas, lunches, clothes. Now, if
00:32:03.609 --> 00:32:06.250
you count the real hours of commute, the getting
00:32:06.250 --> 00:32:08.069
ready, the decompressing, you know, the exercise
00:32:08.069 --> 00:32:11.369
we just did, it comes to about 50 hours a week.
00:32:11.650 --> 00:32:15.950
So her real rate is roughly $17 an hour, not
00:32:15.950 --> 00:32:19.130
the $28 that's on paper. Now let's look at the
00:32:19.130 --> 00:32:21.549
single parent, the one that's next to her. This
00:32:21.549 --> 00:32:24.089
woman makes the same salary. She's even sitting
00:32:24.089 --> 00:32:26.920
at the same desk. Her take home is actually a
00:32:26.920 --> 00:32:29.660
little higher though. It's actually around $4
00:32:29.660 --> 00:32:33.119
,150 hitting the account every month. And this
00:32:33.119 --> 00:32:35.019
is because she's filing as head of household
00:32:35.019 --> 00:32:37.579
and she's getting a child tax credit to help
00:32:37.579 --> 00:32:41.299
out. She has the same $320 expenses to get to
00:32:41.299 --> 00:32:43.720
work, just like the first woman, but she has
00:32:43.720 --> 00:32:47.440
childcare. That's another $1,100 a month for
00:32:47.440 --> 00:32:51.460
her kid and an extra hour a day every day for
00:32:51.460 --> 00:32:53.799
drop off and pick up because she has no one to
00:32:53.799 --> 00:32:56.740
split that with. All in all, her real rate ends
00:32:56.740 --> 00:33:00.500
up being around $11.50 an hour. Again, not the
00:33:00.500 --> 00:33:05.119
$28 on paper. So same job, same salary, but the
00:33:05.119 --> 00:33:07.440
working mother ends up earning roughly a third
00:33:07.440 --> 00:33:10.119
less per hour than the woman sitting next to
00:33:10.119 --> 00:33:13.279
her. And neither one even knows it. That's not
00:33:13.279 --> 00:33:16.019
a budgeting problem. You cannot coupon your way
00:33:16.019 --> 00:33:19.299
out of a gap that size. But here is where knowing
00:33:19.299 --> 00:33:22.180
your numbers starts paying you back. Think of
00:33:22.180 --> 00:33:24.950
the chore you hate most. It could be grocery
00:33:24.950 --> 00:33:29.190
shopping or laundry or pickup runs or HOA meetings.
00:33:29.470 --> 00:33:31.130
You'll know what the moment pops in your head.
00:33:31.589 --> 00:33:33.950
Now, calculate what that specific time is costing
00:33:33.950 --> 00:33:36.849
you just for that activity. If it ends up the
00:33:36.849 --> 00:33:39.390
price is below your real hourly rate, it would
00:33:39.390 --> 00:33:41.910
not be extravagant to try to buy back that time.
00:33:42.329 --> 00:33:44.670
This is just running an arbitrage. You're buying
00:33:44.670 --> 00:33:46.650
back an hour of your life for less than what
00:33:46.650 --> 00:33:49.869
that hour is worth and weighted by how much you
00:33:49.869 --> 00:33:52.410
dread the task. because the ones you avoid are
00:33:52.410 --> 00:33:55.410
costing you more than the clock shows. Pat has
00:33:55.410 --> 00:33:57.470
watched this play out across hundreds of households,
00:33:57.869 --> 00:34:00.329
and she says the two that pay off most consistently
00:34:00.329 --> 00:34:02.970
are someone cleaning the house and someone else
00:34:02.970 --> 00:34:04.950
doing the grocery run. And that's not because
00:34:04.950 --> 00:34:07.910
these are luxuries that you've earned. It's because
00:34:07.910 --> 00:34:10.730
the per hour basis is usually cheaper than just
00:34:10.730 --> 00:34:13.030
having someone else do it than doing it yourself.
00:34:13.389 --> 00:34:16.429
So before you cut anything small, look at three
00:34:16.429 --> 00:34:18.929
categories that actually carry weight. Housing.
00:34:19.260 --> 00:34:22.800
vacation, education. Clipping coupons for a year
00:34:22.800 --> 00:34:25.139
saves less than one good housing decision saves
00:34:25.139 --> 00:34:27.539
you in a single month. But the coupon cutting
00:34:27.539 --> 00:34:30.519
feels productive because it's visible. But it's
00:34:30.519 --> 00:34:34.019
motion, not progress. And housing can trap us
00:34:34.019 --> 00:34:36.079
at the transition. If you're going through a
00:34:36.079 --> 00:34:38.360
divorce or separation, deal with the housing
00:34:38.360 --> 00:34:41.360
before you sign the dissolution papers. Not after,
00:34:41.420 --> 00:34:44.639
before. Here's why. The moment those papers are
00:34:44.639 --> 00:34:47.039
executed, you are a single income applicant.
00:34:47.260 --> 00:34:49.219
You're trying to qualify for a mortgage on your
00:34:49.219 --> 00:34:52.099
earnings alone, in this market at these rates.
00:34:52.639 --> 00:34:54.460
Whatever you could have negotiated while the
00:34:54.460 --> 00:34:56.960
household was still legally intact, you are now
00:34:56.960 --> 00:34:59.780
negotiating from a much weaker position. And
00:34:59.780 --> 00:35:01.940
it's understandable why people get caught. When
00:35:01.940 --> 00:35:04.320
you ask them, they'll usually say the same thing.
00:35:04.460 --> 00:35:06.460
I don't want to upset my kids by moving them.
00:35:06.860 --> 00:35:08.760
But here's the thing, they're already upset.
00:35:09.079 --> 00:35:11.539
And they'll be a lot more upset watching you
00:35:11.539 --> 00:35:13.380
stretch thin trying to hold onto a house that
00:35:13.380 --> 00:35:15.920
you can't carry. Now, I want to circle back to
00:35:15.920 --> 00:35:18.050
another thing because I said something at the
00:35:18.050 --> 00:35:20.030
top of the episode and then Pat said something
00:35:20.030 --> 00:35:22.250
else that might sound like the opposite to you.
00:35:22.510 --> 00:35:24.969
So I had said that the head of household can
00:35:24.969 --> 00:35:28.269
be a downgrade. Pat, she had called it a really
00:35:28.269 --> 00:35:30.949
great bracket. The difference is what you compare
00:35:30.949 --> 00:35:33.829
it to. Against married filing jointly, head of
00:35:33.829 --> 00:35:36.349
household is worse. You have a smaller standard
00:35:36.349 --> 00:35:39.590
deduction, narrower brackets and no spousal benefits.
00:35:40.130 --> 00:35:42.750
That tightening is real and it can be felt, especially
00:35:42.750 --> 00:35:46.130
that first year. But against a plain single filer,
00:35:46.320 --> 00:35:48.659
head of household is meaningfully better. You
00:35:48.659 --> 00:35:51.159
get a bigger deduction and wider brackets all
00:35:51.159 --> 00:35:54.179
the way up. And a lot of single parents are quietly
00:35:54.179 --> 00:35:57.119
filing single when they qualified for head of
00:35:57.119 --> 00:35:59.019
household. They just don't know they should be
00:35:59.019 --> 00:36:01.380
filing different. They're actually even measuring
00:36:01.380 --> 00:36:04.019
themselves against a married couple's math and
00:36:04.019 --> 00:36:06.199
sometimes concluding they're just doomed. Which
00:36:06.199 --> 00:36:08.500
brings us to some of Pat's actual advice that
00:36:08.500 --> 00:36:10.380
might not have been what you might have expected.
00:36:10.820 --> 00:36:13.420
Before you max out the 401k or follow another
00:36:13.420 --> 00:36:16.460
standard order of operations, It is worth understanding
00:36:16.460 --> 00:36:20.159
your effective tax rate because the answer to
00:36:20.159 --> 00:36:24.199
401k or Roth or pay down the mortgage is generally
00:36:24.199 --> 00:36:26.940
different depending on your status. Running someone
00:36:26.940 --> 00:36:29.260
else's sequence without checking your own numbers
00:36:29.260 --> 00:36:31.659
is how people optimize for a situation that they're
00:36:31.659 --> 00:36:34.659
not in. And that answer keeps moving as your
00:36:34.659 --> 00:36:37.940
life changes shape. Filing alone, then married,
00:36:38.239 --> 00:36:40.440
then married with kids, and then unmarried with
00:36:40.440 --> 00:36:43.239
kids. The question isn't changing, but the right
00:36:43.239 --> 00:36:46.239
answer does. Look, nobody really is planning
00:36:46.239 --> 00:36:48.400
to raise dependents alone in a system designed
00:36:48.400 --> 00:36:51.179
for two. When it's happening, the system can
00:36:51.179 --> 00:36:53.860
actually feel a lot less like a set of rules
00:36:53.860 --> 00:36:57.179
and more like a punishment. The Census puts median
00:36:57.179 --> 00:36:59.500
income for single mother families at roughly
00:36:59.500 --> 00:37:05.139
$41,000 a year. And in 2024, 21.8% of families
00:37:05.139 --> 00:37:08.159
led by a female householder with no spouse present
00:37:08.159 --> 00:37:11.159
lived below the poverty line. For married couple
00:37:11.159 --> 00:37:14.909
families, it was 4.6%. That's nearly five times
00:37:14.909 --> 00:37:18.929
the poverty rate. Same economy, same work ethic,
00:37:19.449 --> 00:37:21.989
different rule book. But here is what a lot of
00:37:21.989 --> 00:37:24.789
those families never find out. There are programs,
00:37:25.110 --> 00:37:27.329
and most of them are not set at the poverty line
00:37:27.329 --> 00:37:30.949
at all. Child care assistance runs up to 85%
00:37:30.949 --> 00:37:34.210
of your state's median income. SNAP goes to 130
00:37:34.210 --> 00:37:37.269
% of the federal poverty level. Energy assistance
00:37:37.269 --> 00:37:40.989
to 150%. The Earned Income Tax Credit phases out
00:37:40.989 --> 00:37:43.960
well above all of them. So please do not screen
00:37:43.960 --> 00:37:46.420
yourself out. And look past the federal programs
00:37:46.420 --> 00:37:49.579
because state, county, and local is where most
00:37:49.579 --> 00:37:52.420
of the accessible money actually sits. Most people
00:37:52.420 --> 00:37:54.739
never find it because nobody has the hours to
00:37:54.739 --> 00:37:57.639
go looking for it. So one of the things you can
00:37:57.639 --> 00:38:00.719
do here is to start to build searching into your
00:38:00.719 --> 00:38:03.300
plan. Make it the first task of your project.
00:38:03.840 --> 00:38:06.699
15 minutes a day. Look up a phone number. Ask
00:38:06.699 --> 00:38:09.860
AI what you might qualify for. Call your bank.
00:38:09.900 --> 00:38:13.119
Ask for an advisor. Download a form. Those 15
00:38:13.119 --> 00:38:15.659
minutes, they'll start to stack. And some of
00:38:15.659 --> 00:38:17.780
these programs, once approved, they'll run for
00:38:17.780 --> 00:38:20.519
years. And that is a real dividend off those
00:38:20.519 --> 00:38:23.280
15 minutes. If you're following an Escape the
00:38:23.280 --> 00:38:25.960
Clock program, here's the mitigation that Pat
00:38:25.960 --> 00:38:29.380
suggested for this one. Body doubling. Sit down
00:38:29.380 --> 00:38:31.619
next to someone, and you both work on your own
00:38:31.619 --> 00:38:34.639
pile. Your bills while they work on theirs. And
00:38:34.639 --> 00:38:36.710
you're not helping each other. You're doing it
00:38:36.710 --> 00:38:39.389
alone, but it turns out that this is actually
00:38:39.389 --> 00:38:42.849
really helpful to get past that block. And the
00:38:42.849 --> 00:38:44.389
person doesn't even have to be like you. They
00:38:44.389 --> 00:38:45.429
don't have to be your age. They don't have to
00:38:45.429 --> 00:38:47.050
be your gender. They don't even have to be in
00:38:47.050 --> 00:38:49.670
your same situation. So you can widen the search.
00:38:49.909 --> 00:38:51.909
You can find an older neighbor who might generally
00:38:51.909 --> 00:38:54.250
like the company or a younger person who wants
00:38:54.250 --> 00:38:56.349
someone that they can learn from and think out
00:38:56.349 --> 00:39:00.010
loud with or maybe a friend at work. The support
00:39:00.010 --> 00:39:01.909
that works is rarely the support that you might
00:39:01.909 --> 00:39:05.530
picture. OK, so imagine this. Instead of three
00:39:05.530 --> 00:39:08.050
hours loading two kids in the car, navigating
00:39:08.050 --> 00:39:10.409
the store, unloading, and putting it all away,
00:39:10.730 --> 00:39:13.130
the groceries land on your porch without you
00:39:13.130 --> 00:39:14.929
having to go and do anything other than make
00:39:14.929 --> 00:39:18.110
the order on your phone. Now, you end up spending
00:39:18.110 --> 00:39:20.889
those three hours that you would have spent doing
00:39:20.889 --> 00:39:23.150
all the grocery run at your own table with a
00:39:23.150 --> 00:39:26.849
neighbor, both of you working on your own paperwork.
00:39:27.269 --> 00:39:30.250
By noon, maybe you found a childcare subsidy
00:39:30.250 --> 00:39:32.070
that you didn't know had existed because you
00:39:32.070 --> 00:39:34.690
took the time to find it. And maybe you are able
00:39:34.690 --> 00:39:37.829
to take $25 a month and start moving it automatically
00:39:37.829 --> 00:39:41.489
into savings. Each of these things is a nudge,
00:39:41.869 --> 00:39:45.170
and they can create long lasting change. And
00:39:45.170 --> 00:39:47.130
that is how you make the system start to work
00:39:47.130 --> 00:39:49.210
for you. So if there's one thing to take away
00:39:49.210 --> 00:39:51.510
from this episode, let it be this. If you're
00:39:51.510 --> 00:39:54.070
a single parent or a head of household with dependents,
00:39:54.409 --> 00:39:57.010
you're not behind. You were handed a playbook
00:39:57.010 --> 00:39:59.130
written for a home with two of everything and
00:39:59.130 --> 00:40:01.969
then judged for not running it well. The system
00:40:01.969 --> 00:40:04.500
was built for two. Your plan has to be built
00:40:04.500 --> 00:40:08.159
for you. I'd love to hear from you. What is one
00:40:08.159 --> 00:40:10.380
hour you could buy back this month and what would
00:40:10.380 --> 00:40:13.119
you do with it? Email me at contact at escapetheclock
00:40:13.119 --> 00:40:15.260
.com or leave a comment wherever you listen.
00:40:15.639 --> 00:40:17.960
I'm Daniel C. Rodgers. Thanks for listening. Best
00:40:17.960 --> 00:40:20.480
of luck knowing the value of your hour and escaping
00:40:20.480 --> 00:40:24.440
the clock. I'll catch you next week. That's a
00:40:24.440 --> 00:40:26.300
wrap on this episode of Escape The Clock. Everything
00:40:26.300 --> 00:40:27.940
you've heard today is for educational purposes
00:40:27.940 --> 00:40:30.599
only. Designed to help you think, plan and build
00:40:30.599 --> 00:40:32.949
a stronger financial program. Take what resonates,
00:40:33.389 --> 00:40:35.210
bring it into your Escape The Clock plan, and
00:40:35.210 --> 00:40:36.849
review it with a qualified professional before
00:40:36.849 --> 00:40:38.889
making any major moves. I'm Daniel C. Rodgers,
00:40:39.230 --> 00:40:40.829
a Wealth Management Certified Professional and
00:40:40.829 --> 00:40:43.150
your host. The book, the free planner, and the
00:40:43.150 --> 00:40:44.730
one-on-one time with me are all waiting for
00:40:44.730 --> 00:40:46.929
you at EscapeTheClock.com. If this episode was
00:40:46.929 --> 00:40:48.670
valuable, please leave a rating, share it with
00:40:48.670 --> 00:40:50.110
someone who needs to hear it. I'll catch you
00:40:50.110 --> 00:40:50.510
next week.