Why do you always write about couples' money, a reader asked. It's a fair point. So I thought I'd dedicate this column to singles and their money.

Singles may not outnumber those in couples, but they're a big chunk of the population. In the last census, 1.8 million adults were partnered and 1.14 million were single.

In some ways, financial planning for singles is more important than for couples. There isn't a second income coming in, or someone else to rely on financially if you can no longer work due to redundancy, illness or accident. Who would look after you if you became disabled? To whom do you leave your estate?

Plenty of couples live on one income, so in some ways the financial pressures are no different, even for working single parents. In fact, having no one to argue with over how you spend and save your money can be a bonus.


Yet our financial system is geared towards couples. Mortgages often need two incomes. New Zealand Superannuation is around $200 higher a week for a couple, even though it costs much the same for a single to run a household. Even the first-home deposit subsidy in KiwiSaver is doubled for a couple.

Society's standard model is that singles will start to settle down in their late 20s, look after children in their 30s and 40s and prepare for their retirement in their 50s. As a result, too many wait until they're married to start their financial lives and plan for their financial future.

Singles living by the traditional model may not, for example, think of buying property. Yet it is one of the main ways that people in New Zealand build capital. For the average person, the longer they are on the property ladder the more capital they build up. If that single becomes partnered at a later date, he or she will have some capital to start married life with.

Childless singles are often spenders, not savers. Remember the Sex and the City episode in which Carrie did the maths over whether she should use her money as a down payment on an apartment or buy shoes? Some singles will wake up one day and realise they need to start planning for a future on their own.

Everyone, not just couples, should have emergency funds, retirement savings, insurances and so on. As with couples, singles need to think about:

* Budgeting

* Setting financial goals

* Creating an emergency fund


* Planning for retirement

* Preparing a will

* Getting insurance

For singles, it's even more important to have someone authorised to make financial and medical decisions on their behalf if they become incapacitated, which can happen at any age.

One area that is different for singles is life/illness/disability insurance. Singles may not need life insurance unless they have dependent children (or parents), although brokers may try to sell it to them. Critical illness or disability insurances, which pay out lump sums or a percentage of income following illness or accident, may be even more important for singles relying on just their own earning power.

Singles who do find themselves building up capital might want to consider the issue of family trusts. It's often thought they're set up to protect against acquisitive partners (pre-nuptial agreements are probably better at this). They also protect against business debtors and have implications for the cost of long-term care in retirement.

Singles are of all ages, although they're more common in the 20s and 70-plus age groups. Each group has distinct financial challenges. The Gen Ys in their 20s may be expecting to live on one income until they find a mate. A retiree, however, may not want to think about their partner's mortality, or have any idea how to manage their budget if they become suddenly single.

The scenario of being suddenly single also hits mid-life. This can happen through divorce, separation or death and women often have more difficulty coping financially, although it can be difficult for men as well. Suddenly the entire world can seem as if it's topsy-turvy.

The North Shore Women's Centre in Auckland sees a steady stream of newly single women in a range of financial predicaments, especially in tight economic times. Some women, after living comfortably for 20 or 30 years in a marriage, suddenly find themselves destitute.

Centre manager Tracey Swanberg has seen several instances of women in their 60s being locked out of the home and finances and living in one-bedroom apartments, barely able to survive.

"I have worked with lots of women who have come out of very long-term relationships and marriages," says Swanberg, who has a background in social work.

"It is very difficult for these women on a financial and a psychological level and there can be issues around status as well. They may have had a good income and lifestyle and are now living on a benefit."

In one case Swanberg encountered, the woman didn't feel entitled to anything in her former home, which the couple had built up over decades.

She went from a financially comfortable life to sleeping on an airbed in a grotty one-bedroom unit. It highlights the importance, she says, of understanding family trusts before entering into them.

The dramatic change in personal circumstances that the centre's clients sometimes experience brings out emotions such as shame, humiliation and embarrassment.

"You realise you can't buy that pair of jeans or go out for that coffee," says Swanberg. For someone who has never envisaged a financial future as a single, it can be hard to change lifestyle.

The answer isn't necessarily about sending singles to budget advice centres such as the nearby Salvation Army one in Glenfield, says Swanberg. If they have been living on the DPB or other benefit, these women are often already astute budgeters. "It is an income issue," she says. Sometimes they are more in need of the centre's counselling service, legal advice or social work. The centre also runs support groups and is launching financial literacy courses next year.

Some of the other problems the centre sees among newly single women include:

* Women without the money to pay for a decent lawyer

* Children being vulnerable due to the single parent's financial situation

* Singles (and couples) acting as guarantor for others' loans

* Parents having to support adult children in their 20s.

One newly single woman who was supported by the centre recently was Sally Hamilton. When Hamilton split from her husband in 2009, she was locked out of the money in the family trust and business for two years.

Hamilton had sold her house in the UK and travelled to New Zealand to marry an old friend. The proceeds of her house sale were transferred into the family trust set up by her husband and she was handed a document to sign that gave him power of attorney. Being a new immigrant, she didn't understand trusts, was in love and trusted her new partner.

The stress of the separation and being left with no financial means resulted in Hamilton becoming ill, with a heart attack followed by pneumonia and swine flu. She lived on a sickness benefit before the courts finally allowed her to extract some money from the trust in June.

The other situation where people become suddenly single is when a partner dies, with the survivor likely to be left with a reduced income.

He or she will almost certainly have lost his or her financial confidante.

If it's difficult to make financial decisions alone and no one, such as an adult child, is a suitable sounding board, then it's worth seeking financial advice - from an authorised financial adviser if it's about investments, or a budget adviser if it's about making ends meet.

Many organisations, such as women's centres, Citizens Advice Bureaus, budgeting and community law centres, offer free help to singles.