6 Ways This Social Trend Increases Your Retirement Savings

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Recent data shared by the CDC has revealed that U.S. marriage rates are on the rise, and that divorce rates are falling. While this is great in and of itself simply for its positive sociocultural implications, it also brings great news for retirement savings.

The fact is, divorce is expensive — all those legal fees during such a painful period spell hindrances on saving for your retirement. Avoiding a divorce means you’ll keep the various benefits that marriage has on your retirement savings — but don’t worry, this doesn’t mean single individuals can’t still retire comfortably. 

On its face, it might seem like marriage makes saving for retirement harder as a result of having to now share your debt and expenses. The budgeting conversation applies to a wider range — like how having children adds more financial complication. You shouldn’t let the frustration overshadow the positive impact, though. Here are 6 ways that your retirement savings benefit from marriage through reductions, benefits and other unique qualifications.

1. You can make IRA contributions based on your spouse’s income even if you yourself aren’t currently working. You cannot do this if you’re not married and your partner earns income. Inheriting an IRA from a spouse also carries with it no tax implications.
   
2. The spousal benefit for Social Security. The spouse who earns less can receive up to 50% of the other’s benefit. Should one spouse with higher Social Security payouts pass away, the surviving spouse has the option to receive them.
   
3. Filing taxes jointly tends to incur lower interest rates and offer access to tax credits and deductions, plus a greater threshold for income tax brackets.
   
4. You can save a lot in estate taxes (also referred to as death or inheritance taxes), which are taxes applied to a deceased individual’s estate. Through the use of portability, a married couple can combine their estate tax exemptions. 
   
5. Reduced insurance costs and access to various benefits. Spouses can access family benefits on insurance policies, granting them lower premiums. 
   
6. Easier qualification for loans and access to lower interest rates. The married couple can make use of their combined income and credit ratings during their application.

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