Over a lifetime, unmarried women can pay as much as a million dollars more than their married counterparts for healthcare, taxes, and more.
In October 2009, New York Times reporters Tara Siegel Bernard and Ron Lieber compared a hypothetical married couple with an equivalent-earning unmarried gay couple, to see just how much difference those extra privileges made. Here's what they found:
In our worst case, the couple's lifetime cost of being gay was $467,562. But the number fell to $41,196 in the best case for a couple with significantly better health insurance, plus lower taxes and other costs.
This is unfair. The solution? Bernard and Lieber argue that "the federal government [should legalize] same-sex marriage." But in fact, legalizing gay marriage only solves the problem for a few. Many more single people (gay and straight)—more than half of the population—continue to suffer from institutionalized singlism, the discrimination of individuals based on marital status.
U.S. Federal Code Title 5 Part III says: The President may prescribe rules which shall prohibit... discrimination because of marital status. Yet more than 1,000 laws provide overt legal or financial benefits to married couples. Marital privileging marginalizes the 50 percent of Americans who are single. The U.S. government is the main perpetrator, but private companies follow its lead. Thus marital privilege pervades nearly every facet of our lives. Insurance policies—ranging from health, to life, to home, to car—cost more, on average, for unmarried people compared to those who are married. It is not a federal crime for landlords to discriminate against potential renters based on their marital status. And so on.
One reason these policies exist is to encourage people to get married, because being married was—and still is—considered a social good. Some have suggested that marriage makes people healthier and happier, but critics such as Dr. Bella DePaulo have pointed out that most studies show that, in the long term, there is little to no difference between married and single people in terms of health, happiness, or personal responsibility. Additionally, these studies are often poorly designed, consider data sets that are not representative of the general population, or fail to consider alternative hypotheses—for example, people who are already happy might be more likely to become married, or happiness might come from having close interpersonal relationships, which may or may not include a spouse. Whatever the truth might be about marriage's effects, we the authors would like to redraw the lines of discussion and argue that policy-makers need to reject policies that take into consideration an individual's marital status, because such policies are discriminatory.
As two straight women with no desire to get married, we are not against marriage per se. We're not callous and repressed man-haters. We're not bitter about ex-boyfriends who cheated or tried to teach us the correct way to pour laundry detergent (ok, well maybe a little bitter about that last one). We're not even necessarily uncomfortable with the institution's arguable gender expectations and socio-political history. We just don't much care whether we're married, or not. But governments and corporations do.
We decided to determine a person's lifetime cost of being single by paralleling Bernard and Lieber's general approach. So, blissfully unaware of the morass of math awaiting us, we created four characters living in Virginia: two single women and two married women of equivalent means. The single women made $40,000 and $80,000, as did their married counterparts. The two salaries represent relatively middle and high-income levels in Virginia, where 2011 per capita income was $44,700 statewide. So far, so good. Then we broke out the calculator.
Our married women's husbands worked too, earning $51,000 and $103,000 respectively. (The husbands' salaries to reflect the fact that a woman earns 78 cents for every dollar a man earns, although this is the median rate for all women and in fact black and Hispanic women are paid even less.) We assumed the married women filed jointly with their husbands (generally more advantageous than filing separately). We imagined that our characters worked in Virginia from ages 26 to 66 and then lived for another 20 years after retirement. We chose to examine one year in their lives and extrapolate the lifetime impact from their finances for that particular year.
We quickly realized that our experiment could not be comprehensive. Had we looked more closely at a longer time period, we might have seen some fluctuations. Because we didn't have the resources to run 900 income tax returns over 50 years, as Bernard and Lieber did, we left out many complicating factors of the single-versus-married filing-status dynamic. We did not factor in the differences between a married woman with a working husband and a married woman with a stay-at-home husband. Nor did we consider the high probability that our characters would change or lose jobs several times, and/or receive pay increases throughout their lifetimes. And we didn't consider the expenses of children (though for the record single women bear more of a financial burden of raising children, compared to married women). We did not address the high likelihood that our married women would get a divorce or outlive their husbands. A comparison of single versus married men would also likely return different results.
So, what did we examine? The primary areas where government and corporate policies have institutionalized discrimination against single people: income taxes, Social Security, and IRAs. We also looked at discrimination that is not officially institutionalized: housing and health spending. Singles have little choice but to expend more in these areas out of practical necessity.
Here's the breakdown:
Normally, married couples can save thousands of dollars just by filing jointly instead of separately. Those thousands are largely the direct result of federal and state laws that privilege married people.
First, we wondered how much our characters would spend in one year in income taxes. We figured this out with the help of a tax professional, who focused on the taxes the women paid during their working careers.
In 2010, our single woman earning $40,000 paid $6,181. Her married peer paid more than a thousand dollars less: $5,162. The contrast became more dramatic as our subjects' incomes increased: our single woman earning $80,000 paid $16,125, whereas her married counterpart paid almost four thousand dollars less per year. (The numbers for 2011 were similar: our marrieds paid $963 and $3,875 less.)
Here are the numbers extrapolated from income hypothetically earned over 40 years, based on the 2011 rates:
Our single woman earning $40,000 per year paid $245,000 in income taxes. Our married woman earning $40,000 paid $206,000 in income taxes—a difference of $39,000.
Our single woman earning $80,000 per year paid $645,000 in income taxes. Our married woman earning $80,000 paid $490,000 in income taxes—a difference of $155,000.
At this point in our calculations, we each wanted to run out and get a husband, STAT. And the buttons on our calculator weren't even warm yet.
Perhaps the most pervasive myth about unmarried people is that no one will care for them as they age. This fear is both ridiculous, and not. We ourselves feel it sometimes, even though we know that having a spouse and/or kids is no guarantee you'll die in satin sheets with the ocean breeze blowing through your window as muscular half-clothed but fully oiled young men fan your greying cheeks with palm fronds and place peanut butter cups between your lips (we will not say which of us has this particular fantasy). But being married does in many ways make planning and saving for the future easier—simply because society provides more such options for married couples. Nowhere is this more obvious than in Social Security.
Social Security started in the 1930s and evolved partly as a way to support child-rearing women who couldn't work (which at the time was about 85 percent of women). They received benefits through their husbands. Today, women can of course hold jobs and put money into Social Security. Upon retirement, married women can claim their own Social Security or their husbands'. But they are subsidized in large part by single people. The original rationale for this policy was the belief that single men would marry eventually and then recoup the benefits of Social Security at that time. But the repercussions of this reasoning impact singles to this day.
If a single person dies without children, her money will—must—go into the system to be provided to whomever needs it most, which is good because that was the original intent of Social Security. However, if a married person dies, the money can be routed back to her family. This is good for the married person, but fails to account for the important people in singles' lives.
Social Security privileges marrieds in many ways. For example, our hypothetical married woman could receive up to 50 percent of her husband's benefits while her husband is alive. Spouses can also receive 100 percent of their dead spouse's benefits, if the deceased's benefits are higher than the recipient's would have been.
But wait, there's more! For married couples, the federal government throws in this handy dual-claim option: When our married woman reaches retirement age, she can claim Social Security as a spouse and then later as a worker. For example, she could sign up for spousal benefits at age 66 and then wait four years before claiming her own benefits, because by delaying she accrues credits which increase her benefits by a certain percentage (depending on her date of birth).
With these benefits in mind, and stiff drinks in our hands, we calculated and recalculated—in today's dollars—how much more Social Security our married woman received than our single woman. We used the Social Security Administration's online calculator to estimate benefits for our two women, assuming they were both born in 1974 and that they retired at age 66 or 70 and lived until 86. We assumed their spouses were the same age and also retired at ages 66 or 70. Below are just some of the many permutations that resulted in relatively large sums of money for marrieds, at the expense of unmarrieds:
If both women earning $40,000 retire at age 66, they will collect $333,600 if we assume our characters live for twenty years after retirement. If our characters both retire at 70, they would each collect $357,504 over the next 16 years.
If they retire four years later, both our women earning $40,000 can collect an additional $23,904. But suppose during those additional years, our married woman takes her option to collect on her (now retired) husband's Social Security (in addition to her own income). Because her husband has earned $51,000 per year for the last 40 years, his wife would receive $39,768 for those four years, which is half of his Social Security (and doesn't diminish the amount he receives). That's $39,768 that our single woman did not have the option of receiving from a loved one.
If our women earning $80,000 retire at 66, they will receive $496,080 over the next twenty years. If they can hold out on retiring for another four years, they will get $528,960 over the next 16 years.But again, our married woman earning $80,000 can defer retirement between ages 66 and 70 and earn an extra $55,896 in addition to her own income, simply by also collecting her husband's Social Security.
That's a lot of money the government (and single contributors to Social Security) gives to people for saying "I do." But perhaps nothing illustrates the power of marital privilege more than this: unmarried people can ride on another person's Social Security benefits if they were previously married to that person for at least ten years and are 62 and not entitled to Social Security based on their own work history.
If marriage benefits can be flexed based on the nature of the marital relationship, logic dictates that they might also be adapted to include relationships outside the marital sphere. Both of us can think of someone whom we might want to help support via our Social Security earnings.
Single people can designate anyone as an IRA beneficiary or an inheritor of property—or be the beneficiary him/herself. Sounds like great news, right? Not once you compare unmarried people with their married counterparts. Married couples enjoy privileges related to IRAs and property taxes that are unavailable to singles.
First, a married couple can put two people on an IRA while a single person can't; this puts the single in a disadvantaged position. For example, a married person (such as our married women) can put away $5,000 for her spouse (the husband) for every year when the husband is not working. In contrast, a single person can't put away that money in support of someone else, nor can someone else put away money for the single person if the single person is unemployed and not contributing to her own IRA.
Second, spouses can withdraw money from an IRA early, for medical or education expenses, without the usual 10-percent penalty (if those expenses are greater than the IRA-holder's adjusted gross income by 7.5 percent). While it's never ideal to withdraw money from an IRA early, single people overburdened by unplanned medical expenses will lose 10 percent of the withdrawal amount even if the expenses are high. In other words, single people are penalized when they make the same choices as their married counterparts.
Just as married people can inherit a spouse's IRA, single people can also inherit IRAs, even from someone who's not a relative. Once again, however, married people enjoy significant privileges when they inherit the IRA: If the spouse died before 70 1/2 years of age, and if the surviving spouse is under 59 1/2, he/she can defer the required minimum distribution (RMD) until the spouse would have reached 70 1/2—meaning he/she won't be taxed for RMDs during those years (if the IRA is a traditional one). Additionally, surviving spouses can withdraw cash from the IRA early for any reason without accruing the usual 10-percent penalty—no questions asked.
In contrast, if a single person inherits an IRA, s/he must take the RMD—and be taxed for it—within a year of inheritance. Moreover, if she wishes to withdraw money early, she'll incur the usual 10-percent penalty for doing so. If the IRA owner was older than 70 1/2, the IRA account must be withdrawn within five years. In either situation, the beneficiary must pay regular income taxes on her inheritance. Compare this to the benefits received from a surviving spouse, and the imbalance is clear.
In 2009, the Bureau of Labor Statistics (BLS) compared spending habits among single men, single women, and married people. Although many of the categories represent "extraneous" expenses (such as shoes, clothing, entertainment, and dining), the categories of housing and health spending stood out to us as significant, in that these expenses are practical and necessary for all adults.
According to the BLS, couples spent 6.9 percent of their annual income on health on average; single men spent only 3.9 percent (the data doesn't explain why this number is so low); and single women spent 7.9 percent. It's not clear how the BLS broke down these numbers into component parts (ie., did they include insurance premiums?). But we used these numbers to calculate the 60-year lifetime spending on health for each of our women, with the following results:
Our single woman with an income of $40,000 spent $189,600 on health over 60 years; whereas our married woman with the same income spent $165,600—a difference of $24,000.
Our married woman with an income of $80,000 spent $331,200 on health over 60 years, and our unmarried woman with the same income spent $379,200—a difference of $48,000.
Our single women would fall even more behind if they became disabled. Here's why. Disability payments barely provide a livable wage. (We know this because one of us has a chronic illness, and while in the woe-is-me throes of a particularly bad flare-up she researched how much she would make if she went on disability. When she saw the numbers, she sucked it up and went back to work.) Such a system greatly favors married disabled people, because by adding their paltry disability payments to their spouse's wages they can more likely come up with a livable income (although of course spousal support is by no means guaranteed—one's husband may prefer to spend his money on food, shelter, or hobbies). Moreover, our unmarried women's retirement accounts will suffer. Without a job and on a tight disability budget, she would likely struggle to save in an IRA, and as we described above, no one could save for her. However, the husband of a non-working, disabled married woman might manage to afford the yearly $5,000 contributions to the IRA.
Here's the main takeaway for health spending: Singles pay thousands of dollars, or even hundreds of thousands of dollars, more in health spending. This is largely because of discriminatory policies by companies and the U.S. government.
In comparison to health spending, the discrepancies that exist for singles' housing are significant. This happens in part because of the inherent logistical costs of living alone (our single woman would pay more to rent a mountaintop mansion in Hawaii than our married woman would pay, as part of a dual-income married couple), but other factors come into play too, including the biased policies mentioned above.
According to the Bureau of Labor Statistics, on average, couples spent 23.9 percent of their annual income on housing; single men spent 30.3 percent; and single women spent 39.8 percent. We can't say why the disparities exist between unmarried men and women, though we speculate that it may have something to do with the wage gap - but that's another article.
We used these numbers to calculate the 60-year lifetime spending on housing for each of our women:
Our single woman making $40,000 spent $955,200 on housing over 60 years, whereas our married woman making $40,000 spent only $573,600. The married woman saves $381,600 in comparison to her unmarried equivalent.
As one might expect, the difference is even more striking when we analyze the women with higher incomes:
Our single woman making $80,000 spent $1,910,400 on housing over 60 years, whereas our married woman making $80,000 spent only $1,147,200- that's a difference of $763,200.
We did consider that the discrepancy was in part due to the simple logistical fact that two people can split a rent or mortgage. However, other less obvious factors also come into play. As described by social scientist and singles advocate Bella DePaulo, author of Singled Out: How Singles are Stereotyped, Stigmatized, Ignored, and Still Live Happily Ever After, realtors and landlords regularly discriminate against single home-seekers, thus narrowing the pool of housing options for singles. Worse, governments and housing development companies, influenced by the economics of a single-family-worship culture, do not consistently provide housing options for alternative family structures or collective lifestyles that might benefit singles. Just one example might be a house or condo complex with several private bed/bath areas but a shared kitchen and shared living/dining room (and, while we're brainstorming here, a shared beachside Jacuzzi and infinity pool.)
So, what were the final totals?
With calloused and bleeding fingertips we reached for the calculator one last time.
Because some of the categories described above were either too variable or overlapped with each other, we calculated the single woman's "best" and "worst" lifetime-cost scenarios using only the following financial categories: Income tax, Social Security, Housing, and Health Spending. We added up the amounts paid (or not received) for each single woman under each category. For Social Security, where the results were more multifaceted, we chose to use the numbers for when our married women delayed their retirement and received half of their living husbands' Social Security for four years (this was largely because we were unwilling to inflict spousal death on even our made-up characters).
In each category, the singles paid or lost more than the marrieds. The single woman earning $40,000 paid less than her counterpart earning $80,000, simply because she had less money to start with.
When we calculated how much money our characters gained or lost altogether, our single women did indeed fare worse—much worse—than the married women. Their lifetime cost of being single?
Our lower-earning woman paid $484,368 for being single. Our higher-earning woman paid $1,022,096: more than a million dollars just for being single.
We anticipate that critics will point out that the numbers could be manipulated in any number of ways. At every stage in the process we, too, thought "these sums are just too crazy; surely we must have miscalculated or reasoned wrong." We have, however, made only the most conservative of estimates and still reached the conclusion that, no matter which way you read the numbers, the final assessment remains the same: Singles get screwed.