Living the single is life no longer an anomaly. According to the U.S. Census Bureau, 45 percent of households nationwide are maintained by a single person. Being single (and thus, living on a single income) affects many areas of your life when it comes to financial planning, including parenthood, insurance and retirement.
Review your options for disability insurance and long-term care insurance. It is critical to purchase these types of insurance while you are healthy and the premiums are affordable. These insurance purchases increase the chances that you will have adequate cash flow if you are not able to work because of a disability, or if you require assistance with activities of daily living later in life.
Make sure your plans include preparing for health care needs. You may need to direct a lawyer to draft a health care proxy in which you designate a loved one to make medical decisions on your behalf if you are not able to do so yourself. If you have children, be sure to also appoint a guardian in the event that you are not able to care for them.
Think carefully about the type of housing situation that suits your needs. Carrying a single-family home, especially in an expensive housing market, can be difficult on one income. Be sure that your home is affordable enough to permit you to pay for other significant expenses, such as child care and health care, and to invest for financial goals, such as college and retirement.
Investing as much as you can afford for retirement over the long-term is beneficial because you will not have the luxury of falling back on a partner’s pension. In addition, your household will have only one Social Security check to help fund retirement expenses.