Financial Planning

Financial Planning for Single-Income Families

By  Brian Thorp

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Financial planning for single-income families presents unique challenges. These tips from financial advisors specializing in serving single-income households can help you achieve your goals.

Many couples choose to live on a single income, often so one parent can stay home with the children, start a business, or deal with family matters requiring significant time and attention. Other couples find themselves living on a single income following a corporate layoff or unanticipated health issue.

No matter the circumstances that result in a family living on a single income, the financial planning challenges can be considerable. A financial advisor specializing in serving single-income families can become a trusted resource to help overcome obstacles and determine smart money management strategies.

You’ll likely find dozens of nearby financial advisors well-suited to help you reach your money goals with a personalized plan. But it may be more difficult to find a financial advisor who specializes in serving families living on a single income.

Fortunately, many financial advisors offer virtual services so you can meet online no matter where you (or they) live. This means you can choose to hire a specialist financial advisor who lives hundreds of miles away if you decide their knowledge and experience working with single-income families is a better fit to help with your unique financial planning needs.

Financial Planning for Single-Income Families

💡 In the Q&A below, you’ll gain insights from financial advisors who work with single-income families to help them make smart decisions to enjoy life more today while preparing for a comfortable retirement in the future.

🙋‍♀️ Do you have questions not answered below? Use the form on this page to submit your questions, and we’ll update this article with answers from the financial professionals and educators in the Wealthtender community. You can also contact the financial advisors featured in this article directly to set up an introductory call or ask your questions by email.

💸 Smart Money Insights for Single-Income Families

This page is organized into sections to help you quickly find the information you need and get answers to your questions:

  1. Q&A with Financial Advisors Specializing in Serving Single-Income Families
  2. Get Answers to Your Questions About Financial Planning for Single-Income Households
  3. Browse Related Articles

Q&A: Financial Advisors Specializing in Serving Single-Income Families

Eight Questions with Grant Maddox, CFP®, AWMA®, CSRIC®

We asked Charleston, South Carolina-based financial advisor Grant Maddox to answer questions useful to people in single-income families who want to make smarter financial moves.

Q: What is a common financial planning challenge unique to single-income families that you frequently encounter when working with your clients? How do you work with them to overcome this challenge? 

Grant: A common misconception is that finances should only involve one “money handler.” There’s no such thing as a “non-financial spouse.” Include your significant other in your financial decisions and build mutual goals. 

Q: For single-income families who are unsure whether or not they should hire a financial advisor at the current point in their lives, what guidance can you provide to help them make a more informed and educated decision? 

Grant: A second set of eyes at any life stage for single-income families can be a game changer. A fee-only advisor with no conflict of interest is an excellent place to start. In addition, asking your advisor to review potential tax and investment planning opportunities could greatly benefit your planning. 

Q: How do the services you offer single-income families distinguish your firm from other advisory firms? 

Grant: The preparation for becoming a single-income family or turning your side-hustle into a full-time gig can present unique planning opportunities. We spend a lot of time planning for just this situation at Hampton Park Financial Planning.

We help clients assess how their career change will affect their other financial goals. This overview could include planning for how their expenses will change and simulating how the change will impact their financial picture. We also add value by analyzing tax planning opportunities during the crucial period where their income may be the highest before going to one income or starting a business. For example, Donor Advised Funds or, after having gone to one income, Roth conversions or harvesting capital gains. 

Q: When you first speak with individuals or couples who are single-income families, what questions do you like to ask to understand their unique circumstances better and determine how you can best help them achieve their goals? 

Grant: A few of the questions we like to ask include:

  • Do you have joint goals? 
  • Do you have separate goals? 
  • What is your collective vision for the world? 
  • Do you have a joint or separate banking account? 

Get to Know Grant Maddox, Financial Advisor for Single-Income Families:

View Grant’s profile page on Wealthtender or visit his website to learn more.

Q: For a dual-income couple thinking about becoming a single-income household, whether to care for a child, start a business, or for mental health purposes, what do you suggest they consider, and what actions do you recommend they take before one person resigns and shortly thereafter?

Grant: Consider your goals for going to one income and how it relates to your other life objectives. For example, going to one income may mean pushing back your long-term retirement date or forgoing early retirement.

Also, consider your “running board” for when you first go to one income. For example, typical emergency funds are 3-6 months of expenses. Still, looking into doubling this amount before going to one income is crucial. Finally, for those starting a business, ask your advisor to model what it may look like if income comes in slower than expected. Viewing each potential scenario should empower you to make informed decisions. 

For mental health purposes, remember that your family is one team. Your team has always had one combined income, and it will continue to do so after going to one paycheck. 

Q: For single-income families approaching retirement age, how do you recommend they prepare to make the transition from living off a salary to relying upon other sources of income? 

Grant: The basics are essential at any life stage: 

● Ensure an emergency fund is in place. 

● Reinforce your budget for monthly expenses. 

● Account for any significant purchases you will make within 8-12 months of your planning. 

It is also important to build a plan for asset distribution during the earlier years of your retirement. Tax savings are just as significant as portfolio growth. 

Q: Is there anything that comes up frequently in your initial meeting with single-income families that surprises you? 

Grant: This point is perhaps the most central: It’s never one spouse’s income versus the other spouse’s income. It will always be “their” income versus the world of items “they” want to do! A family is a unit and should never be one decision maker based on income.

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About the Author
Brian Thorp, Founder and CEO of Wealthtender profile picture

Brian Thorp

Founder and CEO, Wealthtender

Brian and his wife live in Texas, enjoying the diversity of Houston and the vibrancy of Austin.

With over 25 years in the financial services industry, Brian is applying his experience and passion at Wealthtender to help more people enjoy life with less money stress.

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Disclaimer: In order to make Wealthtender free for our readers, we earn money from advertisers including financial professionals and firms that pay to be featured on our platform. This creates a natural conflict of interest when we favor promotion of our clients over other professionals and firms not featured on Wealthtender. Learn how we operate with integrity to earn your trust.

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