93% of Singles Pay the ‘Singles Tax’ — and Inflation Is Making It Worse

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One is the costliest number. 

Being single has its pros and cons. One of the major drawbacks is the “singles tax,” a term for the added cost of living on your own.

For a perfect example, look no further than renting a home. Renters who live alone pay a singles tax of nearly $7,000, and up to $19,500 in New York City, according to a study by Zillow. Traveling is another area where singles often pay higher rates, with hotels, rental cars, and cruises being a few things that typically cost more for singles.

How much of an issue is the singles tax? Recent research from Forbes shows that most singles feel the burden of it. And some Americans even think twice about breaking up because of it.

How the singles tax is affecting American adults

A recent survey by Forbes Advisor found that 93% of singles acknowledged the burden of the singles tax. Couples can split expenses, so they end up paying less per person for some bills, such as TV and internet. Many companies also offer discounted rates if multiple people get service together, like insurance and cell phone service.

While the singles tax isn’t new, 59% of American adults say that inflation is making it worse. With how rapidly the cost of living has increased, it has become even harder to get by on a single income. Respondents specifically pointed out housing, utilities, and groceries as the areas where inflation has done the most damage.

One in three respondents even said they had stayed in a relationship longer because of the financial benefits. That includes 14% who stayed in a relationship because of a partner supporting them financially. However, 59% said that being able to avoid financial conflicts with a partner might make paying the singles tax worth it.

What you can do about the singles tax

Like older relatives asking if you’ve found someone yet, the singles tax is one of the frustrations that comes with being single. So, outside of downloading more dating apps, what can you do about it?

If you really want to avoid the singles tax, the best option is to live with someone else, such as roommates or family. Two- and three-bedroom homes usually cost much less per room than smaller ones. You’ll also be able to split bills, so you’ll likely pay less for power, water, internet, and other expenses.

I realize that if you’re used to living alone, getting a place with a roommate may not exactly fill you with joy. You’ll need to decide if you value your privacy or saving money more. Your other option would be to look for cheaper housing options, such as a smaller apartment.

Keep in mind that whether you’re single and living alone, you have roommates, or you’re in a relationship, it’s always important to have your personal finances in order. There are a few money rules every adult should follow:

Save and invest a portion of your income every month. A standard recommendation is 15% to 20%, but you can choose any amount that works for you.Build and maintain an emergency fund. Aim to have at least three to six months of living expenses in your emergency savings. It takes time to save this much, so make it one of your goals and put money into your emergency fund every month.Don’t overspend on your fixed costs. Ideally, essential expenses shouldn’t take up more than 50% to 60% of your income.

You may still deal with the singles tax from time to time. But if you follow those rules, you’ll be in good shape financially.

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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Lyle Daly has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Zillow Group. The Motley Fool has a disclosure policy.

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