For many people, marriage brings many benefits, including financial ones. However, don’t be shocked if your significant other feels that marriage is more of a financial burden than a benefit—that kind of thinking is more prevalent than you might imagine.
It’s a common misconception that married couples pay higher taxes than single individuals. This is not only mostly untrue for many couples, but marriage makes financial sense for a number of reasons.
In today’s economic climate, where inflation is soaring and housing costs are skyrocketing, many individuals are reassessing their living arrangements to find ways to save money. One question that often arises is: is it cheaper to be married or single?
This article delves into the cost of living for both single and married individuals, analyzing key factors such as housing expenses, income, and overall financial well-being. By examining these aspects, we aim to provide a comprehensive understanding of the financial implications of different relationship statuses.
Key Takeaways
- Overall, the cost of living as a single person is higher than living with a spouse. Married couples typically share many basic expenses, including housing, while a single individual must cover those costs alone.
- Getting a mortgage can be simpler as an individual than as a married couple. This is because there is only one person’s financial history to consider. When applying for a mortgage as a couple, the lender will analyze both spouses’ finances and typically use the lower of the two credit scores to base their lending decision off of.
- More than 57 percent of single homeowners are women, according to Census data. This highlights the increasing trend of single women achieving homeownership.
Cost of Living Comparison: Single vs. Married
According to the U.S. Bureau of Labor Statistics’ 2021 Consumer Expenditure Survey, the average single person spends about $48,000 annually, of which $17,899 is spent on housing. In comparison, the average married couple spends about $76,000 annually, of which $24,811 is spent on housing – $12,405.50 each.
This data clearly demonstrates the cost advantage of living with a spouse. Married couples are able to share housing expenses, which significantly reduces their individual financial burden. Additionally, sharing other household costs, such as utilities, groceries, and transportation, further contributes to their overall savings.
Is Being Single Financially Disadvantageous?
While the cost of living is generally higher for single individuals, it’s important to note that being single doesn’t automatically equate to financial hardship. Many single individuals manage their finances effectively and achieve financial stability through careful budgeting, responsible spending habits, and income diversification.
Furthermore, being single can offer certain financial advantages. For instance, single individuals have greater control over their finances and spending decisions, and they are not obligated to share their income or assets with a partner.
Housing Costs: A Major Factor
Housing costs are a
Brackets and Phaseouts Aligned
The tax brackets for married couples filing a joint return are currently roughly twice as high as the single bracket rate at the same income, with the exception of those in the brackets for those in the 2035 and 2037 percentiles.
Due to the fact that more married couples filing jointly are now in a lower tax bracket due to their combined income, this alignment reduces a significant component of the marriage penalty.
In a similar vein, the Tax Cuts and Jobs Act’s child tax credit phaseout has been matched, starting at $400,000 for couples and doubling the $200,000 phaseout for singles.
The phaseout was previously $75,000 for singles and $110,000 for couples, so this modification removed yet another possible marriage penalty for families with children. However, unless the law is extended, these amounts will take the place of the higher amounts from 2017 in 2025.
Social Security Benefits
If you are married, you might be eligible for Social Security retirement benefits that are equal to or greater than your spouse’s benefit. If your personal benefit is less than 2050 percent of your spouse’s benefit, then this will be applicable to you. Whether certain requirements are satisfied will determine eligibility, as stated by the Social Security Administration
This also applies to divorcees who have not remarried, were married for a minimum of ten years, and are sixty-two years of age. Furthermore, the benefit that an ex-spouse would receive must be less than the benefit that the divorcee would receive based on their own employment history. In the end, this gives the spouse who made a lot less money than the household’s primary wage earner more security.
Married Couples: To File Taxes Joint or Separate? I Mark Kohler
FAQ
Is it better financially to be married or single?
Is it cheaper to be married or single for taxes?
How much money do you save by being married?
Is it better to marry or stay single?
Do married couples save money?
Married couples can save money by sharing household expenses and duties. Additionally, couples enjoy many benefits single people don’t when it comes to insurance, retirement, and taxes. But being married carries some financial costs as well. For example, weddings are a significant expense for many couples.
Are married people better than single people?
In countless ways that we sometimes don’t even notice, married people’s lives are valued and celebrated while single people’s lives are marginalized or even mocked. That means that when single people achieve the same level of health or well-being as married people, they do so against greater odds.
Should you get married if you’re single?
Perhaps the greatest financial risk of getting married is the possibility of ending up divorced. While being married is generally better for your wallet than being single, getting a divorce cancels that benefit — and then some. The OSU study shows that on average, divorced people have 77% less wealth than single people in the same age group.
Are married people lonelier than single people?
At age 65, Kislev found, the lifelong single people were, in fact, a tiny bit lonelier than the people who had married — a difference of about one-quarter of 1 point on an 11-point scale. Over the course of their adult lives, though, more and more married people feel lonely.