More than three million people aged 65 and over live alone in England and Wales - that’s 30% of the later-life population. In Scotland, the proportion is 35%.
Sarah Coles, Head of Personal Finance at financial services company Hargreaves Lansdown, says: “There are more people living alone than in a couple over the age of 70.
“Most of them were previously married or cohabiting, but if the person with the largest pension has passed away, and it’s a defined benefit scheme, the amount of pension left to the surviving spouse will depend on its rules and is likely to mean compromises over their lifestyle.”
On top of potential drops in income, new data shows the amount of savings needed for a ‘moderate’ retirement has gone up £8,000 for someone living alone, and costs 45% more than for a couple - thanks to the cost-of-living rises.
This is down to simple things like needing to pay the full cost of broadband, food shops, and even a National Trust membership - £84 a year for standard membership compared with £139.20 – or £69.60 each – for a couple.
So, what can be done to help give those coping with higher outgoings a bit more breathing room?
How to save money
Instead of accepting all these extra costs, there is some satisfaction in finding ways to make your money go further.
There are multiple potential changes that can make it easier to save – and may even improve your lifestyle to boot.
Make sure you get the single person discount on your council tax
Single people get a 25% discount on council tax, regardless of their income. Those claiming a pension and on low incomes or Pension Credit (more info on that below) could get bigger discounts from their local councils, so it’s essential to check.
Install a water meter
Most people living alone will be better off with a water meter, which charges you based on the actual amount of water you use.
Without one your bills will be an estimation, based on the size of the property you own. So, if you live in a large family home, you could be paying far more than you need.
However, you do still need to think carefully before you switch. If you love a long shower or water the garden with a hose every evening in the summer, it may not be worthwhile.
Citizens Advice has information on whether switching to a water meter may be right for you.
Consider living with someone else
It’s not just couples who can save. While it certainly won’t suit everyone, if you’ve got the space then why not consider living with a friend?
If you cohabit with someone in the same situation, you can save the additional costs and have a more sociable daily life at the same time.
This will also have the dramatic impact of allowing you to share bills that you’d have to foot yourself, as well as halving the price of the weekly food shop (if you’re open to the idea of sharing meals as well).
Just remember, if you do take the route of cohabiting, you’ll need to let the council know if you’re currently receiving the single person discount.
Buddying up
If you don’t want to live together, then there are other ‘multi-person’ schemes that you could get if you buddy up.
Always check if you must live at the same address for things like joint gym memberships – you might find that you can still get a cheaper rate, even if you’re not living together.
If you’re under 60, the Two Together railcard allows two named people – you and a friend, for example – to make the saving when you travel together.
You can also take advantage of refer-a-friend schemes, where you receive cash or a discount for introducing someone else to a company – meaning you both save on things like energy, broadband, mobile contracts, cashback and shopping.
There are hundreds of options here, and if it’s something you both use regularly, it’s a great way to save a decent chunk of money.
Check if you could receive Pension Credit
Pension Credit is one of the most under-claimed benefits, because many people who have never claimed benefits before might not realise they’re eligible.
You might be one of those that thinks it’s not for you – even if that’s the case, you might find you’re able to claim for a few other benefits that you might not know about.
If you do find you can claim Pension Credit, it can also open the door to other benefits, including an additional discount on your council tax, help with NHS costs, a free TV licence and cold weather payments.
If you’re on low income, there are schemes to help you get access to things like cheaper broadband too through social tariffs, so if you think you might qualify, it’s worth checking out.
Rent out (part of) your home
If you would like to cut your bills considerably, you could consider renting out a spare room. You can either do this on a long-term basis or just at specific times – like during the week or term-time to attract travelling professionals or students.
And it can be a tax-efficient thing to do as well - the Government’s Rent a Room Scheme lets you earn up to £7,500 a year tax-free from letting out furnished accommodation in your home.
For Suzanne Noble, 62, co-founder of Startup School for Seniors, sharing her home has been a game-changer.
She boosts her £30,000 income by up to £1,700 a month by renting out the two spare rooms in her north London flat. One has been occupied by the same lodger for the past three years, the other she lets through Airbnb.
Suzanne, who has been divorced for more than 20 years, says: “As a single person, I would not be able to live here without the extra income. It pays for my utility bills, council tax and the upkeep of the flat.
“Having that money coming in, and someone in the flat, also allows me to stay in the Canary Islands for three months over the winter, knowing my costs are covered.
"There, the cost of living is so much lower. I rent an apartment, don’t have to pay for heating, and eating out costs a fraction of the price in the UK.
“I meet other people my age who are looking for ways to boost their income, and they often don’t think of having a lodger.
“But if they have a spare room, I think it makes a lot of sense. There are compromises, but the upsides make it worthwhile.”
People living alone may have to make their money work harder and, like Suzanne, must make some big decisions without having anyone else to fall back on.
But there is also some value in being completely in control of your finances.
Coles says: "Being in a couple can actually hold some people back in terms of their financial knowledge if their partner makes most of the decisions about money.
“So, while living on your own can cost more, it can also be financially empowering, allowing you to be in control of your money and to spend or save in ways that work for your lifestyle."
