Nearly half of all US adults are single today.
That number has been steadily rising for several
decades. Nearly 70% of men and about 65% of women were
married in 1960.
Today, it's just over 50% of men and around 50% of
women who are married.
Young people are getting married later if they get
married at all. There are also people, of course, in
unmarried partnerships. But I think that a lot of that
really is people who are not ever going to be
permanently partnered.
117.6 million Americans aged 18 and over never married,
are divorced or widowed.
They're not single for the usual reasons that you hear,
"Oh, there's not enough marriageable men for women"
or any of those kinds of reasons, but instead that
they find single life fulfilling.
As someone single living in a major city like New York,
it's definitely very stressful when it comes to
personal finances.
You have the full burden on your shoulders.
So I would say the majority of my friends who are single
and live alone, they're very stressed about the cost
of living.
A 2023 survey revealed that the top three stressors for
single Americans, excluding Gen Z, were all financial.
39% said they were stressed about the general state of
the economy. 38% said it was their long-term
financial future, while 35% blamed the effects of
inflation.
There's a lot of consternation, especially at
early ages and later ages, with being single and
independent, and how much you might need to ask others
for help, both as an optional idea or as a
literal idea to ensure you're going to be okay.
So what's causing so much financial anxiety among
single Americans?
Singles tax is a newly coined term referring to the
financial burdens that are uniquely incurred by single
people.
I definitely think there is a singles tax.
It's much more expensive to be single than to be in a
relationship.
If you're single and living alone, you don't get the
economies of scale.
So instead of having a partner to split expenses
with, you cover everything yourself.
Take a look at South Carolina, which ranks right
in the middle among all states in terms of cost of
living. MIT calculates that the typical expenses for two
working adults with no children total around
$47,483 a year.
By contrast, a single adult with no children has
estimated expenses of $29,880 annually.
That means a single individual has at least
$6,000 more in expenses per year, compared to
individuals who are splitting their bills with
their partner.
I have to cover all of my living expenses, medical
costs, travel expenses, food, etc.
Like everything is on you.
There's really no splitting the bill, which is what's so
nice about having a partner or being in a relationship.
Break down the typical expense even further, and
you can see that nearly every type of expense apart
from medical, is cheaper per person for couples who
have the luxury of splitting the check.
Maintaining your household costs a lot more money now
than it did about 5 or 10 years ago.
And when you're single, there's no one that you can
share and spread those costs along with.
The biggest expense among them is housing.
A 2023 analysis by Zillow revealed that renters pay a
singles tax of nearly $7,000 a year for living
alone. And in major cities like New York City, that
number can be as high as $19,500 a year.
My largest expense is actually my housing, so my
rent takes up the majority of my expenses.
It's definitely challenging finding an apartment and
securing housing in New York City as a single
person, because one, the rent is so high.
So you have to make a certain amount of money to
even qualify for an apartment on your own.
The obvious reason that housing is a bigger share of
single people's expenses is simply that there's one
person living per housing unit, versus two or more
people living per housing unit, but I think it goes
beyond that. Single people may be more likely to live
in expensive cities like New York or San Francisco,
where we have housing crises.
Housing in general has become a big problem around
the country, and I think it is especially acute for
single people in urban areas.
The cost of living in New York City has definitely
made me and my friends reconsider why we do live
here and what we're actually investing in,
because if you don't have a lot of extra money to spend,
if you're spending it all on your rent and your bills
and you can't really go out, or you can't really
enjoy the arts and culture and activities that are all
around New York City, why are you here?
Inflation has also played a major role in aggravating
these expenses.
It's really hard to control your housing expense, and
it's really hard to control your food expense because
they are necessities.
Things like clothing, entertainment, they have
more variability.
But you know, these fixed expenses really do
contribute to that singles tax.
And unfortunately, that's where inflation is hitting
the hardest right now.
Definitely this year especially, the cost of
everything: food, travel, gas for your car, everything
has increased. And that eats into your budget and
eats into your savings account.
But it's not just expenses that are stacked against
single people.
Financial advantages for married couples are written
right into the laws of the land.
The most prominent example is the income tax.
According to MIT's calculator, the typical tax
expense for a single adult with no children is about
44% higher than the split expense from two working
adults with no children.
It used to be that tax brackets were structured in
such a way that if two people were earning money
and then they combined their incomes, they would
actually pay more taxes after they were married.
This marriage tax penalty was largely eliminated for
all but certain states and high-income earners,
following the 2017 Tax Cuts and Jobs Act under the Trump
administration.
There's really no longer a marriage penalty.
The standard deduction is basically double the single
deduction. The time that being married does benefit
you financially is if you do have one spouse that
earns more than the other, you have someone who's
making $200,000 and your spouse is making $400,000.
Now, that does benefit you.
This income gap could result in bigger tax breaks that
are reserved for couples with children.
If there is a disparity in income between spouses.
Now, you may qualify for certain tax credits that you
could not qualify on your own or get a higher amount,
like the child tax credit.
The amount you get is dependent upon your income
or if you're paying for child care, there's the
dependent care credit.
So there are certain credits that do benefit you
if you're married and you bring your incomes together
and one spouse has lower income than the other that
now qualifies you for a specific tax credit and
benefit.
A 2023 survey revealed that 74% of singles disliked
paying more taxes than married couples, and 79%
said they'd like to see the government offer more tax
breaks for single people.
Why shouldn't we get tax breaks?
And even one example, a married couple, they're more
able to purchase a home because they have shared
capital, and that's a tax break in itself.
Social security is another policy that favors those who
are married.
You're able to at times take your spouse's Social
Security benefit if it's higher than yours.
So let's say during your lifetime you earn $50,000 a
year on average, your spouse earned $150,000 a
year. When your spouse passes away and you're
married or you're married for at least ten years, you
now have the option of taking that higher Social
Security benefit, even though it's not based on
your income.
When my married colleague dies, their Social Security
can go to their spouse or in some cases to a whole
array of ex-spouses.
My Social Security goes back into the system.
I can't say, "Give it to a close friend or a sibling or
someone else who's really important to me", and so I'm
basically getting paid less for the same work.
All of these factors, along with the luxury of splitting
the bill, makes it significantly easier for
married Americans to both save and grow their assets.
A 2019 study by the Federal Reserve Bank of St.
Louis found that married young adults have greater
median net worth and homeownership rates compared
to single households.
Between 1989 and 2016, a typical household with a
married couple had three times the amount of net
worth compared to households that were
partnered or single.
I do think it's easier for couples to build assets, and
there's one caveat I'm going to share there is
that, you both have a shared vision of what your
goals are and you both have discipline.
One of the things we've read in studies is that
people tend to achieve their goals at a higher
rate if they have an accountability partner.
So having a spouse or partner living with you in
your household, watching you day to day, month to
month, watching your spending, does allow you to
be able to reach your financial goals a lot more
quickly.
But being single also comes with its unique set of
benefits.
This idea of being single is extremely empowering to
people, which is why they're willing to pay more
to do it.
Financial freedom that comes from being single is really
awesome, because I get to spend all of my money on me,
and my favorite person is me.
So I save a ton of money on dates and money that I don't
have to spend, or gifts and things like that, or even
travel and get to really invest in myself.
And that's really nice.
Or I can repurpose the money that I would use in
dating or as a couple, I can spend that on my friends
and family as well, so there's a lot of freedom
with that.
Nevertheless, certain policy changes can greatly improve
the financial health of single Americans.
Maybe a lot of people who are watching this are young,
single people. And I think for them, the biggest single
thing is to get housing costs under control and make
housing more accessible.
Housing costs are really high and it's also such a
competitive market.
There are so many people who offer these like full
cash offers for homes as well, so that doesn't even
include you having a mortgage. So there are just
so many factors that have made the housing market so
challenging to purchase a home.
Personally, I don't really see a future as a homeowner,
and I'm an optimist.
The single biggest factor in why housing costs are too
high in urban areas is zoning laws.
These zoning laws benefit current homeowners, who tend
to be disproportionately married couples.
That's the problem is that people who own homes know
that the current system benefits them and they will
fight. For example, multifamily housing, they
will oppose that because it lowers their property
values, even though it makes housing affordable for
everybody else.
There are several things that single Americans can do
themselves to navigate around the singles tax.
It's even more important for you to budget, understand
how much money you're making, how much money
you're spending, where is your money going?
You probably have a lot of fixed costs that you need to
be aware of.
Finding someone to split expenses with is one
decision that will likely have immediate impact.
According to Zillow, renters with roommates save $14,000
compared to single renters each year.
Try your best to find a trusted partner, a trusted
individual, that you can share some of your expenses
with. Whether that is a commute, a home, meals, and
try to make that habitual.
I'm not telling you to maintain 30 rolls of toilet
paper, but if you buy 30 and you share it with three
friends, you do have that cost savings that you can
share amongst each other.
So think about yourself integrating into a community
and identifying ways to help minimize some of your
day-to-day expenses.
Being single, sometimes it feels like it's a curse to
people or the way that society positions it, like
it's a bad thing.
It's not. It's great.
Like you have so much life and freedom that you have.
And I would just say, take advantage of it.
Just know that you're a catch and you're going to
end up with someone and you're going to be able to
save money and live a great life.
But in the meantime, enjoy your freedom, enjoy your
friends, enjoy your family, explore, travel, try new
things, pick up hobbies, but you know, really enjoy
the fruits of your labor.