Single or coupled, everyone can benefit from planning for their future. But there are unique considerations to keep in mind for single women, whether you’re happily unattached, looking for a partner, or embracing solo life in a new chapter. In 2023 44%1 of women over 18 were neither married nor living with a partner in the US. So despite being one of many, it can feel like you’re on an island when it’s time to sit down and plan your finances. But we have you covered.
If you’re wondering what you might need to plan for differently as a single woman, here are 6 money considerations you should keep in mind to help set you up for success.
1. Financial planning can be self-care
From everyday expenses to saving for the future—when you’re single, you’re in control of your finances. That can be a freeing thing! But when life gets busy, it can be all too easy to push your financial wellbeing to the back burner. This is where a financial plan comes in: Sticking to it doesn’t just help keep you on track for your goals, it can also be a way to choose yourself.
"The power of the proud household of one starts with a plan to make sure you're saving enough that you'll be OK if something happens to you, help ensure that your savings and investments last the rest of your life, and make sure … you feel good about it no matter what happens in the future. And I see that, honestly, as a form of self-care." — Randelle Lenoir, Vice President, Workplace Regional Leader
The first step is to figure out what’s important to you and set some short-term and longer-term goals. You’ll use these to create a financial plan to help guide your saving and spending.
Of course, being single doesn’t mean you have to figure it all out on your own. Working with a financial professional can help you take your next step. We created a women’s guide to make finding the right one for you easy.
Tip: We’re here to answer your savings and investing questions. You can contact us at 1-800-FIDELITY (800-343-3548).
2. Single women may want to save more for emergencies
When you’re a proud household of one, you are your own back up plan. If something unexpected were to happen—say a layoff or a surprise home repair—you don’t have a partner’s income to help cover your expenses. So while our guideline is to aim to save 3–6 months of your essential living expenses in an emergency fund, a single person may want to save the higher end of that range. But it’s just a guideline—your number is unique to your situation and comfort level.
“I usually tell people to err on the side of caution … the more you have saved for emergencies, the more prepared you’re going to be.” — Vanessa Le, Workplace Financial Consultant
Three months of essential expenses might feel like a lot, but small, consistent savings add up over time. Consider setting up automated payments from your paycheck that go straight to a separate emergency savings account you set up just for this purpose. And make sure that account is both easy to access and earning interest so it’s working hard for you.
Tip: Money market funds can be a good place to stash cash for emergencies and earn interest along the way. Learn more3. Women tend to live longer, which can impact saving for retirement
On average, women live 6 years longer than men.2 That can mean more time to enjoy your second and third acts. But it also means it’s up to you to make sure you don’t outlive your retirement income.
Here are some retirement considerations for single women:
- Day-to-day living expenses: Your cost of living may be higher as a single person, and those costs may carry over into retirement. Plus, if you are newly single heading into retirement, you may need to learn how to budget on one income and recalibrate your plan.
- Health care and long-term care costs: Women tend to spend 20% more on health care across their lifetime3—and that includes retirement. Plus, single women are more likely to need long-term care, which you need to plan for on top of health care.
- Social Security: Factors like divorce or losing a spouse can impact your potential Social Security income. You may want to wait to claim your Social Security benefit to increase your lifetime benefit.
4. Everyone should have a long-term care plan—partnered or solo
It’s always a good idea to plan for your care as you age. Odds are you’ll need it: 70% of people aged 65 and older will need long-term care in their lifetime.4 The truth is that even if you do have a partner or kids, they may not be able to take care of you. Plus, being a single woman means you’re more likely to need outside help. Fortunately, this is another area you don’t have to go it alone.
“Security in retirement isn’t just about savings, it’s also about planning for health and long-term care. Whether you’re single or not, you want to figure out what support you may need—and create a plan for the future.” — Michelle Tessier, Vice President, Women Programming & Partnerships
If you don’t have a family member or close friends nearby to step in, you might consider hiring a patient advocate. They can help in lots of different ways, like helping you make medical decisions or researching specialists. They’ll even accompany you to your doctor’s appointments.
When it comes to the costs of long-term care, a financial professional can help you plan. In 2023, the annual national median for long-term care expenses ranged from $24,700 for adult day care to $116,800 for a private room in a nursing home.5 It’s tricky to know when you’ll need care or exactly how much to plan for, but planning is one way to look out for your future self.
Here are 3 examples of ways you can pay for long-term care:
- Personal savings: If your retirement savings can cover the cost of long-term care, this option gives you a lot of flexibility. Tip: A health savings account (HSA) can also be a great way to take advantage of tax benefits while paying for qualified medical expenses related to long-term care.
- Traditional long-term care insurance: You can decide the amount of coverage, how long it lasts, and how long you must wait before receiving benefits. Although it could be shorter, often you pay an annual premium for life.
- Hybrid insurance: One type of hybrid insurance offers life insurance and long-term care. If you had a long-term care need, you would be able to draw down or accelerate the death benefit amount to pay for your care, subject to monthly limits. However, even if you used up the entire death benefit, the insurance company would still provide additional long-term care coverage.
5. Don’t forget about life insurance
Choosing to purchase a life insurance policy is personal, but just because you may not leave behind a partner doesn’t mean you shouldn’t consider it. Purchasing a policy can give you confidence that important people in your life—be they family, friends, or business partners—are covered.
If you’ve been thinking about buying a policy—either for life insurance or specific to long-term care—you may not want to wait too long! Certain insurance premiums can go up as you age, so it’s helpful to lock in coverage before you develop health conditions that could impact cost, or even whether you’re eligible.
Here are 2 main types of life insurance:
- Term insurance: With term life insurance, you pay a fixed premium for a specific amount of time, or “term.” If you pass away during that time, a set amount will be paid to your beneficiaries. When the period is up, you can choose to continue the coverage, but your premiums may increase. You can use our calculator to find out how much coverage you may want to consider.
- Whole or permanent insurance: Rather than a fixed term, permanent life insurance typically provides coverage for life. Many permanent policies also offer a way to save by growing tax-deferred in cash value. Like term, premiums are also fixed but are likely more expensive.
If you already have life insurance, one step you can take today is to check that your beneficiaries are up to date and that your coverage amount meets your needs. And if you don’t have coverage but are interested in learning more—we’re here to help.
6. Make estate planning a priority, not an afterthought
Just because you’re single, it doesn’t mean that you don’t need to create an estate plan to help carry out your wishes. Some singles choose to leave their savings or property to a charity they’re passionate about. Some have friends, close family or children they are thinking about.
How you put together your estate plan really depends on your situation. But in general, an estate plan is a set of decisions and legal documents that help protect you, your family, and your finances. It can include documents like a will, health care proxy, power of attorney, trust information, account records, insurance policies, and beneficiaries.
Here are some estate planning steps you may want to take:
- Check your beneficiaries to make sure they are up to date on your life insurance, bank, and investment accounts—this is especially important if you’re newly single.
- Consider who you would want to act on your behalf if you were no longer able to make medical or financial decisions. Put in place a health care proxy and power of attorney to make it official.
- If you don’t have someone you trust to take on an executor or trustee role, consider working with an accountant, corporate trustee, or another professional.
- Ask for help. You don’t know what you don’t know—a Fidelity professional can help you understand the estate planning process and work with you to set up a plan that fits your needs. Plus, they can work with you to adjust it over time as life happens.
Estate planning can bring up a lot of questions, but a financial professional and a lawyer can help you decide what’s right for your household of one.
Tip: Fidelity has an easy-to-use online tool called the Fidelity Estate Planner® that can help get you organized, on your own time.
Want to learn more? Tune into our Women Talk Money discussion about planning for and securing your financial future as a single woman.