The Census by Statistics New Zealand in 2023 identified that 24% of households in New Zealand consisted of one-person.
People aged 65 years and over accounted for nearly half of all single person households. The proportion of one-person households increased slightly between 2018 and 2023, while the proportion of one-family households declined.
Some singles delay marriage in hopes of getting their careers and finances in order. Others face financial challenges as a result of divorce or separation, death of their spouse or pregnancy outside of marriage.
Singles often miss the traditional milestones of buying a home, having children, and long-term financial planning. They must be extra cautious with their income and expenses while fully trusting God.
Financial considerations for life-long singles
Living on one income today in preparation for tomorrow requires wisdom. My advice to singles, young and old, is to learn how to steward money. Handling money from a Biblical point of view will help you to face the future without fear. The Bible suggests:
“Get all the advice and instruction you can, so you will be wise for the rest of your life.” (Proverbs 19:20 NLT)
Find trusted advisors who can help you to take a short- and long-term view of finances. Goals must be set, and these principles apply:
Work with joy
Give first
Save second
Spend wisely
Diversify your investments
Good housing decisions are key
Some single people cannot buy a home due to their inability to qualify for a mortgage because they don’t have enough income to meet the mortgage payments by themselves. In 2023 36% of single person households were renting compared with 34% of all households. However, the percentage of single person households who owned their own house increased from 60% in 2018 to 64% by 2023.
Housing tends to be the largest annual expense for single-person households. Downsizing or relocating can eliminate some of the financial stress.
Owning a house isn’t always a better option than renting. Many people compare the weekly rent they are paying with the cost of weekly mortgage payments but forget the significant costs of home ownership that you don’t pay as a renter. Major costs of home ownership include council rates, insurance and home maintenance. Home ownership may be a better option however if you are able to pay your mortgage off quickly. It is better to save as much as you can before launching into home ownership. While you have a mortgage your weekly costs will usually be higher than if you are renting. It is worthwhile to look at online rent vs buy calculators to see which is the best option for you.
If you are struggling with housing costs, whether renting or owning a house, you may need to consider alternative housing options:
- If you are living in a large home, it may be necessary to sell and move to a smaller home.
- Take on a boarder or flatmate. Your property rates, maintenance and heating costs are likely to be less in a smaller home.
- If you have a good relationship with your children, there are now more options for adding an additional house on their section without needing to subdivide or adding a self-contained unit onto their existing house.
- Co-owning a house with family or a friend is also possible but seek good legal advice before proceeding with this.
- Living near family is important, but there are large variations in the cost of living across New Zealand and within the same city. Looking at other location options may reduce your financial stress.
Prepare for economic turbulence
Inflation and the economic recession are concerns for all of us, single or married. We do not know what the future holds, but we know that economic conditions are always fluctuating. Abiding by Biblical financial principles and making wise choices can cushion the fallout we may experience in the coming months.
Variable expenses should always be closely analysed. Look back over credit card and bank statements to see how much is being spent on groceries, transport, utilities, and entertainment. Seek discounts, eliminate waste, and make some cost-saving sacrifices. Many people need to find creative ways to reduce their spending. Recording all spending for at least 30 days will help you see where your dollars go. We are facing uncertain economic times, so we need to be extra savvy. Frugality does not mean misery. It can provide freedom!
