The difference was also extreme at the extremes, according to a blog post by Steve Utkus, who oversees the Vanguard Center for Retirement Research.
In his review of the study, Utkus noted that the top 30% of married households had savings of $332,400 or more while the top 30% of single-person households had just $90,000 or more. The bottom 30% of married households, meanwhile, had less than $24,000 saved while the bottom 30% of single-person households had less than $800.
But divorce isn’t the main reason for singles having less money. If that were the case, Utkus wrote, he’d expect single-person figures to be just under half of those for married couples. But the gap is much wider than that. To be fair, the study doesn’t reflect the value of housing wealth which often becomes part of a divorce settlement, so it’s possible that the gap is not as wide.
The early death of a spouse is another reason why single households have less money than married households, according to Utkus. The all-too-familiar situation goes something like this: “One spouse, often the working male, becomes sick in his 50s or early 60s, loses work, and then dies prematurely,” he wrote. “The healthier spouse, often the female, may have a lower income or may not be working. She spends savings on living expenses and her husband’s medical costs. The loss of savings accelerates if they lose health insurance. Long-term care such as a nursing home can also accelerate the loss of assets. Medicaid, which can be used to pay for nursing care, doesn’t kick in until the household depletes most of its savings.”