It hits today, and tomorrow too …
Various research has come out over the years remarking on the single person premium, a concept so old it lives in an adage. They say two can live as cheaply as one.
Incidentally two can’t live as cheaply as one, not like-for-like anyway, but it invariably winds up more efficient when two people can split bills, food, fuel and so on.
Nothing revolutionary there, but new research from the Office of National Statistics (ONS) lays out the single person premium as it stands today amid the cost-of-living crisis.
It’s stark, it’s concerning, and it seeps into one’s present and future financial health.
Double whammies
The ONS found that for every £1 of disposable income one has, they’ll have 17 pence left over at month’s end if they’re one of a couple, and just 8 pence left over if they’re single.
That’s not great news for one’s ability to pay down debt or save money. And neither is it great for one’s ability to plan ahead …
Case-and-point, Phoenix Group research found that nearly half of midlifers in couples regularly contribute to their retirement pot, but just over one third of singles do the same.
This is doubly problematic given that single people need to save up more for a so-called ‘moderate’ retirement income which, for couples is £43,100 per year (divided by two), and for singles is £31,300 per year (divided by one). Seems the only discernible financial advantage for being single is the 25% discount on council tax. Small beer, really.
Awareness is key
There’s no magic bullet here, but awareness and vigilance are keys to help bring back some of the shine to being single, financially speaking anyway …
1. Clarity. Record exactly what’s coming in and what’s going out for a clear picture of your financial life. It doesn’t need to be complicated: spreadsheet, pen and paper … or securely link your accounts to the Money Means app and it’ll do the hard yards for you.
2. Budget (and stick to it). The most effective way to save more is to set a spending plan and track expenditure against it; tweaking and tuning so you emerge on target at the end of the month. Awareness and vigilance are the name of the game.
3. Pay yourself first. When setting the rules and regs of your spending plan, put yourself down as line item #1. Allocate funds to future you in the form of savings or investments, and automate these payments so they come out first on payday.