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Key Takeaways:
Financial professionals are no strangers to tailoring strategies to meet varied client needs. However, an increasingly relevant demographic worth focusing on is DINK couples—Dual Income, No Kids. According to a Pew Research Center Survey, a rising number of U.S. adults who don’t already have children say they are unlikely to ever have any, and their reasons range from just not wanting to, to concerns about climate change.1
These clients often have unique financial planning requirements, especially when compared to families with children. Understanding the specific needs and opportunities for DINK clients can help you offer more focused and effective advice. Let’s explore why financial planning for childless clients may look different.
Raising children is a significant financial commitment. According to the USDA, the most recent data puts the average cost of raising a child from birth to age 18 at approximately $233,610 (excluding college expenses).2 This hefty sum incorporates expenses like housing, food, childcare, education, and healthcare. The data where this annual report was published hasn’t been updated since 2017, however, so adjusting for inflation3 that figure is over $300,000. For many households with children, these costs can represent a substantial portion of disposable income. They often necessitate a more conservative and long-term approach to saving and investing. On the other hand, DINK couples don’t face these financial burdens, which can lead to distinct advantages when it comes to wealth accumulation.
The typical DINK household enjoys the benefit of two incomes but without the financial drain of child-related expenses. When analyzing the Current Population Survey from the United State Census Bureau, Rocket Mortgage found that DINKs earn an average of $138,000 per year, which is almost 7% more than dual-income families with kids.4 Knowing this, your DINK clients may differ from clients with children in the following ways:
With their higher savings rates and fewer financial responsibilities, DINK couples may have the potential to retire earlier than households with children. Here are several strategies you can discuss with your DINK clients:
Financial planning for DINK couples offers unique opportunities and requires tailored strategies. Although the reasons your DINK clients don’t have children may vary, generally households with two incomes and no dependents can free up more money for spending, saving, and investing. By understanding the distinct financial landscape of dual-income, no-kids households, you can provide more effective advice, helping these clients achieve their goals—whether it’s early retirement, extensive travel, or simply enjoying a comfortable lifestyle.
Investing involves market risk, including possible loss of principal, and there is no guarantee that investment objectives will be achieved.
Diversification does not assure a profit or protect against loss in a down market.
Nationwide and its representatives do not give legal or tax advice. An attorney or tax advisor should be consulted for answers to specific questions.
NFM-23997AO