The Typical American Family Not So Typical Anymore

As the marriage rate decreases and the divorce rate increases, the image of the typical American family – mom, dad and 2.3 children – has changed drastically. According to 2010 Census data, married couples make up less than half of U.S. households. Households married with children were only 20 percent, and those “typical” households with two children: just 8 percent.

The greatest change is the number of single households – 31 million or 27 percent – which is an increase of 15 percent from 2000 and four times more than the 7 million in 1960. As the profile of the American family continues to change, households need to reevaluate their financial planning as well. 

All households may face financial challenges depending on the state of the economy, but some challenges can be more difficult depending on your household structure. Usually, married couples are more financially prepared for these challenges, as they may have two incomes to work with, or the opportunity for the other to work if one spouse is unable to. Also, married couples often receive spousal retirement benefits, such as with Social Security, which is not available to unmarried couples. 

Single households have the extra challenge of funding their own retirement while supporting their entire household financially. Often this can include caring for aging parents and children simultaneously on a solo or even fixed income. While being part of that sandwich generation may be easier for married couples who can rely on two incomes, unfortunately marriage does not come with a financial guarantee. Eighty percent of women – with longer average life spans than men – will die single, widowed or divorced, which is why it is important to have alternate plans in place, should your household structure change suddenly.  

No matter the demographics of your household, financial challenges are best overcome by reviewing your financial situation and determining the best financial path for your household with the assistance of a Certified Financial Planner.  

FINANCIAL FACTS 

Bouncing Back – It took the stock market one year and one day to recover from the single-day loss that occurred on “Black Monday.” The index closed Monday, Oct. 19, 1987, at 225, down from 283 the previous trading day. The next time the index closed at 283 or higher was Oct. 20, 1988. The S&P 500 began Oct. 15, 2012, at 1,429 (source: BTN Research).  

The Doctor Will See You Now – Although the average American aged 18-64 visits a medical provider once a quarter (i.e., 3.9 visits per year), 24.7% of Americans never visit a medical provider during the year (source: Survey of Income and Program Participation, BTN Research). 

The Reality – The actual results for fiscal year 2012 (i.e., the 12 months ending Sept. 30, 2012) were $2.45 trillion of tax receipts and $3.54 trillion of spending, producing a $1.09 trillion deficit. That is equivalent to borrowing 31 cents for every $1 that the government spent during the latest fiscal year (source: Treasury Department, BTN Research).