The share of one-person households in the U.S. has more than doubled to 28% since 1960, and now equates to 1 out of 7 adults (see Figure 1).1 That number looks set to rise as some key demographic trends play out like:
A retreat from marriage and childrearing. In 1970, 9% of U.S. adults aged 25 to 50 had never been married; today, that’s quadrupled to 35% (see Figure 2).2 And since 2017, the marriage rate has dropped to a historic low (see Figure 3). From 2018 to 2021, the number of childless adults who said they weren’t likely to have children rose from 37% to 44%.3 This shouldn’t be surprising: Millennials and Gen Z assert that they are less interested in getting married and having children than previous generations. Even those that do eventually marry remain single longer. These single people are not necessarily living alone. Many young adults live with parents or roommates because they can’t yet afford their own place. But, as they earn more and opt for the soloist lifestyle, they could establish 10 to 15 million new solo households in the U.S. over the next two decades.
A global shift towards a solo society. In Japan, solo living used to be associated with elderly widowed women. No longer. Since the 1990s, the number of 20-39-year-old soloists increased by 19% for men and 89% for women, creating what’s been called a “super solo society.”4 Surging demand for micro apartments led a Tokyo developer to erect 100 buildings made up of 95 square foot abodes — homes too small to meet code in New York City which requires at least one room to have 150 square feet.5 The shift towards a solo society might be happening even faster in China where the number of adults living alone rose 20% between 2018 and 2021, marriage rates have reached an all-time low, and its famed ‘Singles Day’ brought in a record $139 billion for retailers Alibaba and JD.com in 2021. Living alone requires a relatively high income, and with Asia’s middle class projected to grow by one billion people over the next decade, its soloist population could approach that of European cities like Oslo, Berlin, and Paris where they already make up 50% of households.7
Increasing lifespans and a growing preference for aging in place. A century ago, 70% of widows and widowers moved in with their families.8 Today, the same proportion choose to live alone. That being said, widowhood is actually less of a factor than it used to be for older men and women living alone. Instead, both divorce rates and the share of men and women who never married have increased substantially. Moreover, as Baby Boomers grow older, the number of households headed by someone over age 80 will surge to 17.5 million by 2038, the majority of which will be made up of a single person.9
What Matters to Families of One
Researchers say that the rise in the soloist population has a variety of drivers: women’s liberation, mass urbanization, increased longevity, improved communications technology, and a growing desire for personal independence.10 The reasons are plentiful and differ across America’s 37 million soloists. So, to better understand their situations, aspirations, and challenges, FCAT Research interviewed eight soloists of varying age, occupation, and wealth. While each person had a unique story, several common traits revealed themselves (see Table 1). Families of one:
Take pleasure in solitude. Many observers equate living alone with loneliness, but the two are not synonymous. Said a 49-year-old male soloist who has never married, “I love the serenity at the end of a day. It’s not a compromise. I like the enjoyment of my own sanctuary.” Smart companies see the opportunity in catering to soloists’ desire for solitude. For example, Japanese restaurant Ichiran popularized solo dining with private partitioned booths for one; the chain now has 80 locations across Japan. With a third of Gen Z travelers saying that they prefer to be alone when they travel, and solo holiday bookings by Gen Z women up 88% from 2015 to 2019, tour companies are ramping up their solo traveler options and cruise lines are even eliminating the “single supplement” that can run as high as 200% of the ticket price.
Crave meticulous control of their finances. Despite, or perhaps because of, their autonomy, budgeting is a core concern for soloists. While several interviewees use apps, the most popular financial management tool is an Excel spreadsheet. The spreadsheet approach fits the ethos of the soloist: living alone can be costly; yet it offers complete control over managing spending and achieving the lifestyle they seek. One fintech that may speak to this need is Tiller, which offers customizable templates that users can port into Google Sheets or Excel and connect with their bank so that their spending, income, and balances update automatically.
Value their independence above all else. Interviewees acknowledge the high cost of living alone, yet strongly prefer it. Said a 29-year-old non-binary researcher from Iowa, “I’d have to be kind of desperate before [getting a roommate].” Blogs geared to younger audiences understand this premium placed on independence, which is why they advise readers to create multiple income streams if times get tough (as opposed to finding a “dreaded” roommate). Consumer goods companies are easing the burden of living alone, too. Some meal kit companies now offer meal plans for soloists, and innovations such as Betty Crocker’s single-serving “Mug Treats,” “Simply Small” bread loaves, and Haier’s small space appliances were designed with the soloist lifestyle in mind.
Embrace their solo futures. Finding a spouse was not a priority for either young or middle-aged singles we interviewed, nor for the widower who was uninterested in remarrying. Instead, when they pictured their futures, they emphasized buying homes by themselves, traveling solo, finding more satisfying careers, and planning for their financial futures. Says Jay Zigmont, founder of Childfree Wealth, “Most, if not all, financial rules of thumb assume you have kids. [Without them] generational or legacy wealth matter a lot less.”11 That’s why he thinks soloists without children should prioritize flexibility in long term savings and pursue a lifestyle he calls “FILE” – financial independence, live early. Said a 52-year-old male from Tampa, Florida who had recently moved from New York City, “I've never been married. No kids. So that makes things fairly easy for me as far as planning. I want to live comfortably, but I don't want to live in luxury…I know what I need to survive and exist.”
Why It Matters
Though some restaurants, travel companies, consumer goods manufacturers, and finance bloggers support soloists, for the most part, society has not yet shifted to accommodate the rise in solo living. Housing, tax policy, and—yes finances—have all been designed to accommodate families. For example, fewer than 19% of new homes or apartments built in the U.S. in 2021 were one-bedroom, even though single women make up 19% of the home-buying market and single men another 9%.12 Soloists can benefit from:
Day to day budgeting. Over a lifetime, it costs between $480,000 and $1,000,000 more to be single than married—driven by years of higher tax rates, larger per-person housing and healthcare costs, and lost spousal IRA contributions.13 Just take housing: in 2021, it ate up 37% of soloists’ spend compared to 33% for married couples and 31% for married couples with young children (though single parents spent the most at 38%).14 TV, internet, utilities—added up, covering bills like these on your own make living alone a costly proposition. Even auto and home insurance are often more expensive for singles than for married individuals. So it’s no surprise that 45% of single men and 50% of single women say that they feel anxious about their finances—more than married men and women.15
Retirement planning and advice. As of 2016, only 44% of single men and 45% of single women had retirement savings, compared to 67% of couples.16 That’s despite the fact that a single person may need 60% to 70% of the combined lifestyle costs of a couple to retire comfortably.17 Recent research on single women finds that they’re less comfortable with professional advice, less likely to feel that financial services companies understand how to help them with retirement and financial planning, and do not know who to go to for financial advice as compared to married women (see Table 2).18
|Share of women who:||Single, never married||Divorced||Married|
|Feel that saving for retirement is a priority||59%||59%||73%|
|Know who to go to for financial advice||55%||64%||73%|
|Work with a professional financial advisor||20%||28%||40%|
|Feel that financial services companies understand how to help them with retirement and financial planning||69%||75%||80%|
|Feel that they have been treated fairly by financial services companies||71%||80%||85%|
Employee benefits. Ninety percent of all U.S. companies offer greater valued benefits to married employees than single employees.19 These disparities show up in employer health care contributions, paid family leave, bereavement leave, additional pension contributions, and flexible work schedules. For example, 41% of companies offer flexible work schedules exclusively to married employees, and 70% of companies only offer paid family leave to employees with children. It’s no wonder single women are more likely than married women to feel that they’ve been treated unfairly in the workplace.
Soloist households will continue to grow in the U.S. and across the world, and as financial services companies strive to serve them better, important considerations include tailoring planning and advice to their needs, helping them develop decision support networks, and addressing misconceptions about living alone.
2 https://ifstudies.org/blog/the-share-of-never-married-americans-has-reached-a-new-highand analysis of census
Lufkin, B. (2020, January 15). The rise of Japan’s “super solo” culture. Www.bbc.com.
6 https://www.insider.com/92-million-chinese-singles-live-alone-in-2021-up-from-77-million-in-2018-2021-3and https://www.cnbc.com/2021/11/12/china-singles-day-2021-alibaba-jd-hit-record-139-billion-of-sales.html
15 Newsroom | Northwestern Mutual - Planning & Progress Study 2016. (n.d.). Newsroom | Northwestern Mutual.
16 Economic Policy Institute, State of Working America Data Library, “The State of American Retirement Saving,” 2022.