How to Sort Out Your Finances When You’re Single

Ah, bachelor life. You can do what you want, when you want – and you don’t need to consult anyone when it’s time to make a big purchase.

But budgeting and planning your financial future can be challenging for a one-man company. While you have the freedom to make your own choices, that freedom can make you wonder which moves are right for you.

It’s also difficult to plan ahead when you’re not sure what your future will look like. Maybe you will get married or live with someone in the future; maybe you won’t. Maybe you want to settle down and buy a house; maybe you need the ability to travel the world on a whim.

Don’t let your idle status be an excuse to give up managing your finances and planning ahead. Here are some strategies to help you think of your money as one person.

Make a budget that suits you

There are so many money-saving tips that require you to collaborate with others, including the dreaded “Save hundreds every month by having a roommate!” you see tips everywhere.

You don’t have to live in a group home at the age of 30 – however, to be a money-saving adult. (But if you do, that’s cool too.) You just need a budget that suits your needs.

“Try to simplify your finances and budget by using the 50/20/30 rule,” recommended Lauren Anastasio, CFO of personal finance company SoFi . If you keep fixed spending at 50% of your monthly income, you can spend 20% on your savings, and you still have 30% for discretionary spending. “If there is only one income earmarked for the savings goal, it’s okay if you prioritize saving over other discretionary spending,” she said.

A 50/20/30 budget leaves you with plenty of wiggle room that you can change if your priorities change over time.

Create a foundation for growth

Of course, your priorities are bound to change. Budgeting for a single life at 20 is different from managing money at 40, for example. But the sooner you build a solid foundation by budgeting and planning your savings , the better off you will be.

If you’re 20 years old, you need to focus on paying off your student loans, start saving for retirement, and get used to a lifestyle that’s right for your means – Riley Adams, accountant blogging at The Young and Invested. … As you get older, your income is likely to grow, giving you more flexibility. “As you earn pay raises and move up the career ladder, it makes sense to start evaluating how much you can afford to contribute towards savings goals, home ownership, and anything else that fits into your financial plan,” he said.

You will most likely have extra money to spend on retirement savings or other purposes. “You will have less overhead without children or other dependents, and you will be solely responsible for your financial progress,” Adams said.

Plus, because you don’t need to consult with anyone about your important financial decisions, you have the freedom to move around to take higher-paying jobs if the opportunity arises, he said.

Enjoy how easy it is to be lonely

If you’ve ever resented the comment, “Oh, don’t worry, you’ll meet someone someday,” when a relative stranger hears you are lonely, this one is for you.

“Remember that a lot of married couples start their marriages out of debt at a big party with a caterer and a bad DJ,” Anastasio said. “When someone gets married, they can also shoulder the burden of their spouse’s previous debts. For half of married couples, their partner is in a weaker financial position than themselves. ” If half of the relationship has bad credit or bad spending habits, she said, it can be a serious financial burden.

And look, are you filing taxes together? It’s okay . But it’s not a secret how to save on taxes. “Submitting documents together is often not so much a financial privilege as a fine,” Anastasio explained. “The income level for tax groups is not exactly double that for married couples than for those who file alone, which means that some couples who apply together pay more than as two single people,” said she.

Stand firm in your choice

Just a three week vacation? Take action. Don’t want to play the fifth wheel with your siblings? Do not do this. It can be difficult for people who haven’t been single for a while to understand where you are coming from with your financial priorities and choices.

But don’t feel like you have to lean back to make someone happy other than yourself. Remember this especially during the holidays – during this beautiful time of the year when everyone seems to wonder if you see anyone.

If you’re the only person contributing to a family gift, don’t feel like you have to pay more than your share just to keep things equal. And don’t let your single status mean you automatically have to travel to see your family if they can travel too.

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