Consumer Watch: How being single affects your finances
OKLAHOMA CITY (KOKH) —
Your relationship status does have an effect on your finances. There are three major ways single people have a harder time when it comes to finances. These are not impossible problems, but it is something to know about as you make financial decisions for your life.
1. income tax is the first way single people have it harder.
Lisa Rowan, a savings expert at the Penny Hoarder, says people who are filing jointly as a married couple have the lowest tax rates, and people who are filing as a single person have some of the highest tax rates.
As a single person, make sure you have selected the right amounts be taken out of your check at work, so you don't end up owing the IRS later. If you are a freelancer, make sure that you are taking your filing status into account, or you could also end up owing money.
2. Health insurance can also be trickier when you are single.
"That's because it is easy to bundle family plans. single people will need to decide if theirs can come from work, their parents-- if they are under 26 years old-- or through a state exchange," says Rowan.
3. Budgeting plans are more difficult for single people.
"You really need to be mindful about what you are going to do with your earnings. You need to be mindful about putting money into a 401(K) or an IRA, making sure you have emergency savings, and making sure that your expenses really fit what your household needs are," says Rowan.
Being single, or newly single, may mean more planning when it comes to finances, but it is still possible to hit all your savings goals even with out the additional income. Some things are the same whether you are single or married. For example, try not to spend more than 30-percent of your take home income on your housing expenses. This will ensure you have some money to put into a savings account.
It is important to note that the 30-percent for home expenses doesn't just mean rent or mortgage. Regular costs like utilities and home insurance should be accounted for as a part of the percentage.