Single vs. Married: Which Lifestyle Is More Expensive?

Libby Kane
Posted

Around Valentine’s Day, a personal finance site’s thoughts turn to love.

Well, love and money.

We got to thinking, as we do, about the difference between being single and married … that is, in dollars.

Currently, singles make up 49% of the American population, and 28% of all households consist of one person—the highest levels of singledom in American history.

According to sociology professor and author Eric Klinenbergsingles are supporting the United States economy through discretionary spending that far exceeds both married couples and parents.

From taxes and house-buying to paying for a wedding, marriage is either the best thing or the worst to ever happen to your finances, depending on whom you ask. And that’s aside from the value judgments surrounding any discussion of relationships: “But are you happy?”

There are many factors: the little things (like sharing the cost of utilities), government policy (which changes every few years) and the psychology that makes couples spend differently than singles.

But in whose favor do the chips fall? We matched up the two scenarios, head to head.

The Little Things

When it comes to little, day-to-day expenses, it’s obvious that married couples have the edge because they’ve sliced their basic costs in half: only one cable bill, one rent bill, one utilities bill. There are also less obvious savings, like skills-sharing. A partner who can sew a button or fix a loose doorknob saves money on paying someone to do it for you. These “discounts,” of course, also apply to unmarried, cohabiting couples. A point to the marrieds on this one.

The Taxes

According to a Congressional Budget Office analysis, 51% of married couples paid less filing jointly than they would have filing alone as singles, saving an average of $1,300. Interestingly, the more disparate their incomes, the more they saved. Of course, the benefit decreases if you earn a very similar income to your spouse, like 40% of dual-income couples today. At any rate, we’ll make that one point in honor of the marrieds. (For more information on marriage and tax brackets, read this.)

But, in favor of the singles: When a combined income pushes you into a higher tax bracket, your permitted IRA contributions don’t increase proportionately, meaning that you might be better off operating with a single income. So we’ll give everyone who’s single a point on this, too.

Work-Related Expenses

Married couples in which both members work outside the home can choose between two health care plans, letting them pick the best deals or coverage. They’re subject to higher auto insurance payments, too, as auto insurance companies tend to assign less risk to marrieds. (And more choice, less risk means a point for the marrieds.)

Also, singles tend to need larger individual emergency funds than marrieds, as they don’t have a partner to help out in the case of a lost job or medical problem.

Social Security

Another tax consideration is Social Security. MSN Money points out that when it comes time to receiving benefits, a married person can choose to receive benefits based on either her own work record or that of a spouse. While today, one-third of women currently out-earn their husbands, 62% of women over age 62 get benefits based on their husband’s careers. Therefore, working women aren’t benefitting from the money they contributed over the years—they’re receiving the same benefits as if they hadn’t worked. While this is very interesting, LearnVest Certified Financial Planner Stephany Kirkpatrick warns that Social Security is a broken system. Since the Social Security system benefits women who didn’t work but penalizes those who did (and since it may not be around much longer), we assign no points.

The Legal Responsibility

Right off the bat, marrying someone makes you legally responsible for their financial missteps—you assume equal responsibility for their debt and become a part of lawsuits filed against them. (Granted, the issue of liability in the case of lawsuits is only a serious consideration for high earners in risky positions, like doctors.) In the nine community property states, any personal assets that get mixed up with shared assets are considered community property, so they’re shared equally in the case of divorce … and that includes debts. For that reason, in this category, singles come out ahead (point: singles).

The (Reverse) Transition

This LV reader and her partner combined their finances, but then … they broke up. Help her figure out what she should do, or share your own stories.

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The Rights

Along with making you responsible for your spouse’s debts, marriage also gives you a right to their money. Not just the cash left on the coffee table or the funds in your shared bank account—if your spouse passes away, you automatically inherit his or her assets, unless a will says otherwise. Spouses are also exempt from the estate tax, which takes a piece of large inheritances bequeathed to anyone except a spouse. (To find out more about the estate tax and other estate planning issues, read this.) Additionally, in the case of wrongful death, a surviving spouse can sue the person or organization at fault and collect damages, although permissions and amounts vary by state. Edge: Married couples.

The Mindset

Data has shown that singles, as a whole, spend a disproportionate amount of money on eating out, entertainment and costs such as clothing and gym memberships—basically, the things you value most when you’re single. But experts speak of a shift in mindset, where those who were once spenders flip a proverbial switch at the altar, suddenly socking away savings for major expenditures such as houses or children. Suddenly, you’re working toward something bigger than yourself, and taking on responsibility accordingly.

One of the most jarring stats we’ve come across is that while marrieds tend to start saving for retirement as soon as possible, singles postpone saving until their forties. But if that’s you, it’s important to contemplate what effect delaying can have on your finances. And if the delay in saving is the truly the case, marrieds get a point for this one, too.

If we were to tally the points, singles would rack up two, and “marrieds,” five. But remember, this is all relative: The important thing is to remember to do what’s right for your finances no matter what your relationship outlook.

A good way to start—whether there’s one, two or however many of you? Create a budget in the My Money Center so you know where your money goes.

More From LearnVest

Can a woman’s success affect her marriage? It’s the Heidi Klum effect.
Keeping your last name? It may cause trouble at the bank. Find out why.
Our reader Carla eloped to save money … and saved $10,000 in three years, on a $40,000 salary. How she did it.

  • Jessie B. Rubin

    Wow, thanks LV for explaining why I should feel even WORSE about being single at Valentine’s Day. Not only am I alone but it’s also more expensive this way. Fantastic!

    • Anonymous

      Its better to be single and waiting for the right person than married to someone you’re not 100% into. (Or as Marilyn Monroe says- “It’s better to be unhappy alone than unhappy with someone – so far.” You’re not alone in your frustration with the commercially fueled holiday that leads you to believe that the happiest people have a significant other. And, Valentines Day is really about more than significant others’ love, its about familial love, and friendship love too. V-day can be a “you” or “Girls Day out” day. I always treat myself to a little Godiva Truffle if I work that day, and when I was single, I was totally not above buying myself a flower or a little pot of tea roses to take to work for the day (even when working at Subway all they way back in high school, tee hee). Its all about what works for you, I also have single friends that volunteer on V-day, or send out e-cards to family. I found a quote you may like:
      “I believe in manicures. I believe in overdressing. I
      believe in primping at leisure and wearing lipstick. I believe in pink. I
      believe happy girls are the prettiest girls. I believe that tomorrow is
      another day, and… I believe in miracles.
      ” ~Audrey Hepburn
      I really sincerely hope that you have a rocking Valentines Day, Jessie

    • David

       Being married is more expensive. As a single guy you can get a roommate or tenant to cut the mortgage and utility bills in half.

  • Anonymous

    One important point I think you’re missing for singles: When you marry, you have to share a credit score, in addition to debts. If one person in a couple has terrible credit, staying unmarried allows you to still get decent rates on loans, get into apartments, etc. :) It’s been working for us for a couple years now!

    • Smart Guy

      There is no such thing as sharing a credit score. You each have your own.

      • ranavain

        Huh! I looked it up, and you’re right. Though joint accounts and anything signed together (such as a mortgage or loan) will impact both, and affect each’s ability to obtain said loan, there’s nothing inherent about marriage that entangles credit scores (though my understanding is that marriage does make you legally liable for your spouse’s debts, which if action is taken to collect them, will impact your score in the same way).

        Thanks for commenting, and prompting me to investigate this!

  • http://www.facebook.com/hollyyama Holly Yama Hall

    I’m self employed. Being single means more time, and you know what time equals..$.
    I made 50% more money this year being single as opposed to last year (when I was cohabitating).

  • mcdebo

    Stephany Kirkpatrick needs to go back to school re: Social Security.  Sure, there are a few issues that need to be tweaked such as the one she points out.  However, the system is hardly broken, it hasn’t missed a payment in all its existance.  And it will be solvent for the next 30 years.  It will continue to be solvent if the government stops borrowing money from it and the income cap is lifted.  A person who earns $200,000 a year pays Social security tax on only the first $100,000, and nothing on the rest of their income.  If this cap were to be lifted, Social Security would be solvent forever.  Dont let anyone tell you that Social Security needs to be “fixed”.  “The “fix” is to privatize Social Security and give the money to Wallstreet to invest the money.  And we have seen how well Wallstreet does gambling with money.

    • Tina86

      As a woman in my 20′s, I can honestly say I’m confident I will NOT be receiving Social Security.   Honestly, maybe that is for the best.  

      Social Security is not a sure bet, and so I am making sure that I take proper steps to save, invest, and protect the income I earn so that I am not left in the dust when the system collapses.This economy and the mindset of America today is to sell out the next generation so that the current generation bears non of the burden it has created.  Social Security is one such animal.  What would really be best is allowing me to opt out of Social Security, and to be responsible for funding my own retirement.  Not taking my taxes to pay into something that will most likely not be around in the 45 years is would take me to be eligible.  It is unfortunate that Social Security will probably not be around for me.  This is a reality for those of us just entering the workforce.

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  • Tricia Drake

    lol, getting married was very expensive for me!  I make about twice that of my husband, so I did save some on my taxes.  Even though I like having a house, yard and two dogs, if I was single I would still be living in an apartment or condo.  Also, I would live closer to work, so my transportation costs would be about $400 less per month.  Basically, hooking up with him more than doubled my expenses, and only increased my income by one third.  Now that we have kids, it is even more expensive, and I wouldn’t have kids if I was single.  

    But expenses aside, I am much happier living the married lifestyle with the house and yard and dogs and kids and hubby to hang out with.    

  • Anon

    GO MARRIEDS! That’s why being single is so bad…when you have someone to share your love with, it’s so much more cheaper and all in the name of love!

  • David

     Over half of all marriages end in divorce so you lose half ur bank account. Single people can live with a roommate or tenant to cut the mortgage and utility bills in half. Bottom line is your expenses are higher being married than being single. A tenant will pay the rent most of the time and you have a written contract. With marriage love might get in the way of money.

  • David

    Oh and you forgot to mention that married people have higher risk of having kid and single person has a zero chance of having a kid. You could include the costs of raising a kid from 0 to 18 years.

  • Joyflop

    What about same-sex couples? It’s even more complicated.

  • SunnyX

    For me, being single has been less expensive than the relationships I’ve been in. Even when a partner and I split housing and utility costs, I have always been the one to do at least 99% of the grocery shopping. The guys I was with just would not do it, and would not kick in anywhere near enough money to cover their share. I have a medical condition that requires that I eat organic. The guys loved to eat what I buy, but didn’t want to contribute. Grocery bills get expensive when I’m feeding myself and a male that eats like a freaking lion; paying to feed him just about equals his share of the rent-I might as well live alone. Many men want a mommy, and that can be costly in many ways for a female.

    Then there’s the time factor. Time is money. When I live with a man, I end up spending alot of time cooking for him, cleaning up after him, compromising for his needs, and putting time into the relationship in general. When I’m single I can focus on my career and business pursuits, which increases my income.
    Then there’s the freedom an autonomy of being single–and that is priceless.

  • Luis Moreno

    You know what? screw that dream I once had of being married. Single life here I come. If anything, it’ll help me socialize with more women and understand them. Not only that, but I can save a lot of money too, like others have mentioned.

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