What Is 'Singles Tax' and How Can You Overcome It?

Being single can be an empowering experience. Living alone, having the freedom to do whatever you want whenever you want, and not having to take on anyone else’s drama or expectations means more people than ever are opting to do life solo. But singles often face a financial burden that couples just don’t, especially when it comes to the cost of living. Here is a guide to the ‘singles tax’, what it means for you as a single person, and tips on how to manage your money effectively in spite of it.

What is the ‘singles tax’?

Don’t panic! The ‘singles tax’ isn’t a literal taxation on single people. Rather, it’s a term colloquially used to describe the additional cost that can come from doing life solo rather than with a partner. That said, some countries do offer tax benefits to married couples, either through concessions or through more favourable tax brackets.

Effectively, the ‘singles tax’ comes down to the fact that many aspects of life are set up for couples and/or families. From food servings in the supermarket coming in twos or fours, to travel packages costing more for singles than twin share, to things like rates and utilities costing the same regardless of whether one or two people are using the services.

Most common instances of ‘singles tax’

• Rent and living costs. Sharing a home with a partner usually means you’re splitting the cost of your rent or mortgage. While some countries offer discounts for people living alone, like the UK’s 25% council tax reduction for singles, the cost is still higher per person for singles rather than two adults in a couple. Plus, couples can share a bedroom, unlike two housemates or one single person living in the same-sized property.
• Saving and borrowing. Couples have two incomes from which to save for a house deposit, and banks are more likely to lend to two incomes rather than one. So, even though a single person may need less space than a couple, it’s still easier for the couple to buy a home.
• Household expenses. You might think that two people use more water than a single person, but base rates and connection charges for utilities often mean a single person wears substantially more than half the cost of a couple.
• Travel. Travelling with a partner can be more cost-effective than travelling as a single person. Splitting the cost of hotel rooms can make your money go substantially further compared to footing the entire bill on your own. Plus, many package travel options like cruises or tours charge a premium for a single person who isn’t sharing with a partner.
• Gifts. Shouldering the load for gifts is another burden on singles. While it does depend on your friend group and family dynamics, singles who find themselves among a sea of married friends or family members often have to foot the bill for wedding, birthday, Christmas and baby shower gifts on their own, while couples split the same cost between two of them.
• Conveniences. Singles may find themselves having to pay out for favours that a partner might otherwise do for them for free. Things like airport pick-ups, help when sick, or childcare support all need to be paid for when you don’t have a go-to partner to call upon.

Why is managing money harder as a single person?

Managing money as a single person is not only a numbers game, but a mental one too. Yes, being single can pinch your bottom line — but there’s also the mental load to carry. Not only can you not split costs, you can’t split decision-making either. The weight of earning an income and paying your living costs falls solely on you, which can be burdensome to singles who may not have other support from close friends or family.

How to slay your money management as a single person

Despite the financial challenges of being single, there’s nothing to say you can’t build a financially secure life for yourself solo. In fact, there’s evidence to suggest single people are often more successful than couples due to their sense of autonomy and self-sufficiency. Here are some top tips on managing money successfully as a single person, from setting yourself up for stability to getting creative with what you spend.

Set yourself up for stability

Managing money solo means shouldering a lot of responsibility on your own. It pays to prioritise setting yourself up for stability by building an emergency fund and considering your personal insurances should you run into unexpected adversity. While life changes threaten almost anyone’s financial situation, it’s even more important when you’re single. Using a tool like PocketSmith can help you stay on top of your budget, plan for the future, and build a strong foundation for your fabulous single life!

Cook once, eat twice (or thrice!)

Many singles find that cooking for themselves all the time takes a toll on their mental health, as there’s nobody to share the load. Try to work smarter, not harder, when it comes to things like cooking, by cooking a serve for two or three people, and storing it to eat another day. This way, you only need to cook 2-3 times per week instead of every single day.

Prioritise yourself and your values

Being single is a lot of responsibility, but it brings with it opportunity. You don’t have to worry about what anyone else is doing, earning, spending or saving — you get to call the shots, so make the most of it! Work out what’s important to you, and use money as a resource to build a life you love on your own terms. Really dig deep and think about the life you want to lead, and then map out a plan to make it happen.

Team up with friends or coworkers

Many parts of the singles tax come down to economies of scale — it’s often cheaper to do something for two people than for one. But these savings aren’t only reserved for couples. Try teaming up with other single friends or even siblings or coworkers, and share the life load with one another like an economic partner. You could trade portions of meals you’ve cooked, share lifts into work, be each other’s emergency call if you need a ride somewhere, or even consider communal living. While your days of cramming four or five people into a tiny share house might be behind you, you might be able to get a better quality of life by splitting the rent of a four-bedroom, two-bathroom home with a friend instead of each paying for a tiny studio or one-bedroom apartment.

Make the most of your freedom and accelerate your financial growth

Being single brings a lot of freedom, and you can use this to your advantage to make big leaps forward on your financial path by seizing opportunities that couples might be unable to access. Consider things like housesitting for free accommodation to turbocharge your savings, renting out a room in your home if you have unused space, or even living abroad in a lower-cost-of-living country for a year to maximise your life experience and boost your savings. Living the same life as a couple but doing it solo will often cost more, but there are lots of opportunities to make the most of your freedom, too.

Check out the PocketSmith money methodologies hub

When you’re single, knowing your numbers and prioritising your savings is critical. If your budget needs a refresh, check out our money methodologies hub to browse different budgeting styles to find one that suits your personality.

Emma Edwards is a finance copywriter and blogger, on a mission to humanize the financial services industry by creating meaningful content that’s accessible and empowering. You’ll find her penning money tips at her blog, The Broke Generation, sharing financial insights on Instagram, or injecting life into content for her business clients.