Now that I’m in my 40s, I meet a lot of single people. Maybe they’re divorced or what have you. A lot of them seem totally focused on staying single, yet they want to be financially independent. This is a shame because in staying single is building wealth with the brakes on. That is, if you are in a marriage where you work well with your partner, your wealth really improves.
Here is an example from a Facebook group I’m part of.
And here is the same perspective on Twitter. Its popular.
This attitude is a shame, because staying single but wanting financial independence is building wealth with the brakes on.
Here is a research finding:
Findings show married couples have higher levels of wealth than all other household types.
– Asset holding and net worth among households with children: Differences by household type. Grinstein-Weiss, et al. Children and Youth Services Review, Volume 30, Issue 1, January 2008, Pages 62-78.
This just one example, but the finding is consistent wherever you look.
Why do married people have higher levels of wealth?
There are economies of scale, but also a number of significant tax and fixed expenses benefits.
- Pooled incomes give both people more options
- Married people file in tax brackets that are often effectively lower than singles.
- Married people often get reductions in long-term care insurance, homeowners and auto insurance.
- Couples that are married typically qualify for more advantageous loan terms and often have better credit.
- Health insurance. If both people in the couple offer health insurance, they can choose the plan that’s cheapest for them.
Hat tip: Investopedia.
Take Off The Brakes
So here is the takeaway, if you single, consider getting a partner and teaming up with them. Being single is basically wealth building with the brakes on. You have none of the economic or tax benefits married couples have access to. In contrast, if you are happily married, you’ll have have someone to share your struggles with. And, since since you’re typically living together you’ll realize household economies of scale – including only having to pay one rent payment or one utility bill (instead of two).
Read More Great Articles On Couples Finance
If you are married and its been good for your finances please leave a comment below!