There’s a good chance there are single people in your area. Almost half of adults in the United States are currently single.
According to statistics, there are 117.6 million Americans over the age of 18 who are unmarried, divorced, or widowed, accounting for 46% of the population. US Census Bureau data.
That number has been increasing slowly but steadily since the 1960s. As more adults are single or remain unmarried for longer periods of time, the total cost of living has continued to rise in recent years, leaving many people feeling overwhelmed by the cost of living.
“Most of my friends who are single and live alone are stressed out about the cost of living,” Kyshon Holloway, a single man in New York City, told CNBC.
While it can be an important factor for people trying to find a romantic relationship, paying for dates is not the reason single people struggle financially. In addition to being solely responsible for living expenses that are split equally by married couples, single people are also excluded from some financial benefits available to married couples.
This is what the U.S. “single tax” looks like:
Living alone is cheaper in dollar terms. After all, he has only one mouth to feed, he only has one person to use household items, and there is only enough space in the house to accommodate one of her bodies.
But when you add it all up, it costs just half as much to maintain a one-person household as a two-person household. This is why it’s called the “single tax.” It costs more to be alone than to share the costs with a partner.
Kayshon Holloway said she and her single friends are stressed out about living expenses.
Jooheon Lee and Mark Risea | CNBC
Take South Carolina, for example, which ranks near the middle of all states in terms of cost of living. Missouri Economic Research and Information Center.
According to estimates, a typical year’s worth of pre-tax expenses in South Carolina are: This includes necessities such as food, housing, health care, and transportation. Massachusetts Institute of Technology:
- single person household: $29,880 per year
- two person household: $47,483 per year
A two-person household could split the cost down the middle, each contributing about $23,742 a year, while a single person would have to pay an additional $6,138 on top of that.
The biggest factor is housing. Single people often have to choose between finding a roommate or paying for the entire cost of a house or apartment themselves.
In expensive cities like New York, it costs an average of $3,550 per month to rent a studio apartment. According to Zumper data for October 2023.. That means a person living alone would pay $42,600 a year in rent, but a couple splitting the same rent down the middle would only pay $21,300 each.
Even if individuals earn high incomes and keep the cost of living low, “the economic benefits for married couples are built into the law,” Vera DePaulo, author of “Singled Out,” told CNBC. .
In some cases, married couples have benefits that don’t exist for single people, such as income taxes.
“Previously, tax brackets were structured in such a way that if two people were making a lot of money, and they combined that income, they would pay more in taxes after they got married,” said Monique Morrissey, senior economist at the Economic Policy Institute. ” he told CNBC.
She alludes to what is commonly known as a marriage tax penalty or bonus.
Before the Tax Cuts and Jobs Act of 2017 went into effect, couples were more likely to face a so-called “marriage tax penalty.” This means that married couples can combine their incomes and fall into a higher tax bracket. Under reforms in 2017, this penalty was almost completely abolished except for some states and very high earners.
The “marriage tax bonus” occurs when couples file jointly and pay less income tax than they would pay individually.
After the Tax Cuts and Jobs Act went into effect, it became easier for married couples to receive tax bonuses, except for those who pay the highest taxes. According to the Tax Policy Center. The reason for this is that with this change, apart from the 35% tax bracket, the income bracket for married couples filing jointly is exactly twice the income bracket for individual filers.
It’s not all bad news for single people.
“The financial freedom that comes with being single is really amazing. I get to spend all my money on myself and the person I love the most is me, so that’s really great,” Holloway says. “I was able to really invest in myself and that was really great.”
“My favorite person is me,” Holloway says.
Jooheon Lee and Mark Risea | CNBC
That being said, as a single person you may need to pay particular attention to your finances since you don’t have the financial safety net of a partner’s income. Parents, friends, and other family members may help you, but most of the time you are on your own.
“Create a budget and understand how much you’re making, how much you’re spending, and where your money is going,” says Camilla Elliott, a certified financial planner at Collective Wealth Partners. is even more important.”
Housing costs a lot of money, so the most effective money-saving advice might be to get a roommate or downsize your space wherever possible.
Beyond that, Elliott recommends looking for other ways to leverage the community to reduce costs.
She uses toilet paper as an example. It’s usually cheaper to buy in bulk, but if you’re the only one living in a small space, you may not want or need to have so many things on hand. “If I buy 30 pieces, [rolls] If you share it with three friends, you get cost savings that you can share with each other,” she says.
“Think about how you fit into the community and find ways to minimize your daily expenses.”
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