Financial Planning for SINKs and DINKs

Financial Planning for SINKs and DINKs

Financial Planning for SINKs and DINKs

For SINKs and DINKs, financial planning is … different. 

What are SINKs and DINKs, you ask? SINK is an acronym for “single income, no kids.” And if you guessed that DINK stands for “dual income, no kids,” you’re right! But there’s much more to approaching financial planning for folks in the “no kids” camp than the simple fact that they don’t have children.

I’m sure you can imagine that people choose not to have children for as many reasons as others choose to add kiddos to their families. I define the “no kids” piece of the SINK and DINK descriptions in a few ways:

  • People who don’t currently have kids and aren’t planning to add to their families, although it may become an option in the future
  • Those who have made the decision not to have children
  • Foks who never did have children, are beyond their childbearing years, and who have no intention to adopt

I recently stumbled across an article about the childfree community and a podcast episode on the childfree movement that stuck with me. They got me thinking about what makes financial planning unique for folks without children, and I wanted to share them with you here.

Planning Today

As I was preparing Budget Plan Worksheets for clients like you this month, I thought about how cash flow is different for SINKs and DINKs. Simply put, day-to-day planning considerations for them don’t include children. The big ones? No costs for raising children, childcare, or education expenses.

This creates opportunities. Did you know that the cost of raising a child to age 18 averages over $270,000? And that’s just one child! One part of that expense is childcare, which averages over $10,000 per year. Add to that one big planning goal for many clients with children: College. The average cost of education at an out-of-state public university is $27,560 annually. Multiply that times four with inflation added each year — and don’t forget about room and board as well as other cost-of-living expenses! 

While some SINKs and DINKs may assist friends and family members with their or their children’s living expenses, not having these expenses in part or at all makes a huge difference in planning annual and lifetime expenses. This means that folks without kids may be able to achieve other goals earlier in life or have more cash-flow flexibility along the way.

To maintain cash flow for that flexibility, long-term disability insurance is important for DINKs, but it’s crucial for SINKs. That’s because single individuals don’t have a spouse or partner to rely on for income if they’re not able to work. Enter disability insurance, which replaces a portion of income in the event of, you guessed it, disability. And since a disability can last years, SINKs can especially benefit from insuring against income loss. 

Don’t have disability insurance as part of your employee benefits package? Let’s quote an individual policy! Just securely upload your most recent pay stub, and complete this questionnaire. I’ll use your pay stub to project the amount of annual income your disability policy would need to cover. And the questionnaire will help us get reliable quote estimates.

Speaking of insurance, without children to provide for in the event of premature death, SINKs and DINKs might not need life insurance. Of course, if you’re in the “no kids” camp and your employer provides life insurance to you at no cost, take it! (Insurance planning consultations are coming up in November, but you can grab a time on my calendar anytime to discuss yours.)

That “insurance” piece brings me to another important point.

Planning for Tomorrow

When it comes to insurance, I often hear people with children say that they don’t want to “burden” their kids if they were to require care in the future, like assisted living. For many children, “returning the favor” isn’t a burden when their parents need such assistance. But for SINKs and DINKs, a long-term care plan — whether through a traditional insurance policy or self-insuring by having funds set aside should a need arise — can be an important consideration. 

Maybe it’s to maintain independence for as long as possible or to live a certain lifestyle even when not completely independent. Perhaps it’s to ensure that they’ll receive dignified care or to avoid reliance on the Medicaid system. Whatever the reason, those who won’t have a support system in a younger generation later in life may find such a plan crucial. (If you’re thinking, “This sounds like me!” Let me know! I’m happy to work with you to get quotes and illustrate a long-term care policy’s impact on your financial plan.)

With long-term care needs tending to fall at the end of one’s financial plan, what happens for SINKs and DINKs after they’re gone?

Planning for the Future

That’s where philanthropy as well as estate and legacy planning come in. The philanthropy piece boils down to giving now or giving later, and it brings up options for lifetime and future gifts. 

Giving Now

Without the expenses of having children of their own, some SINKs and DINKs find themselves with wealth that they’d like to share with family or friends. For those wanting to give monetary gifts, the 2022 gift tax exclusion is $16,000 per gift recipient for individuals. For married couples who elect to split gifts on their tax return, that doubles to $32,000 per gift recipient. If you give more than the exclusion amount to any single recipient, plan to have us add a gift tax return to your income tax filing next spring. The same goes for couples who choose to split gifts.

The perks of lifetime giving include being able to see loved ones enjoy your gifts now and celebrating the journeys they’ll take with them. And don’t forget that you can make unlimited gifts directly to some institutions — like universities and hospitals — to assist others with health care and education-related expenses.

Giving Later

For those planning to give later, planning for that future is key. Deciding where your stuff will go through your last will and testament as well as your beneficiary designations is one thing. And this can be especially important for unmarried DINKs who don’t have a spouse to pass assets to automatically. 

Don’t know where to give yet but know that you want to? A donor-advised fund (DAF) can help. The DAF is a “give today, gift tomorrow” vehicle. In other words, you add funds to the fund now and can later determine to which 501(c)(3) charities those gifts will go. Plus, donations to a DAF are tax-deductible, so it’s a win-win! And if funds are left in a DAF when you pass away, your will can dictate to which charities they go.

Estate Planning Considerations

Future givers need to plan not only for the gifts they’d like to give but also for themselves. This future planning also involves outlining later decisions now in case you’re not able to make them down the road. It’s crucial if you wouldn’t want someone to have to make certain decisions on your behalf blindly. 

That’s how having a power of attorney (POA) and a living will or health care power of attorney (HPOA) in your estate planning documents can help. A POA allows the person or people you authorize to make financial decisions on your behalf while an HPOA does the same for health care. Both also allow you to provide specific directions and general guidelines in writing so that the person or people you authorize can act in accordance with your wishes.

Whether you’re a SINK or DINK — or neither — we’re here to help! Keep in mind that we can also assist as you plan your gifts to others, whether you’d like to give during your lifetime, through a DAF, or as part of your estate plan. 

Ready to schedule your next meeting?

Simply head to the Meeting page where you can find and schedule a convenient time to discuss whatever is on your mind.

Regina Neenan
regina@fpfoco.com

Regina Neenan is a CERTIFIED FINANCIAL PLANNER™ professional and the Director of Cash-Flow and Insurance Planning at Financial Planning Fort Collins. With a lifelong passion for personal finance, they have been serving FPFoCo clients since 2018. You can learn more about Regina on our About page.



MINIMUM ACCOUNT SIZE
The minimum initial investment for the Invest:FOCO platform is only $5,000 per account. This minimum can be met via transfer of an existing account or with new funds.
ANNUAL FEE
1.00% of assets under management ($100 per $10,000 managed). Debited from your account(s).
FINANCIAL PLANNING
Strategy:FOCO financial planning services are ongoing, and include unlimited phone, email, web and in-person meeting and consultation time. Pricing is based on the unique circumstances of each client situation. Generally, there is a one-time plan development fee ranging from $500 - $2,000 and a monthly fee of $150 - $500; cancel anytime. Clients utilizing investment management services with portfolios of $500,000 or more will typically receive financial planning services for no additional fee.
INVESTMENT MANAGEMENT
Assets Under Management (AUM) Annual fee as a % of AUM or flat-dollar
$0 - $249,999 (See Invest:FOCO)
$250,000 - $499,999 0.90%
$500,000 - $999,999 0.80%
$1,000,000 - $1,999,999 0.65%
$2,000,000 - $2,999,999 0.50%
$3,000,000 - $3,999,999 $15,000
$4,000,000 - $4,999,999 $20,000
$5,000,000 or more $25,000 + $2,000 per additional $1mm
MINIMUM ACCOUNT SIZE
There is a minimum initial investment of $100,000 per Strategy:FOCO client household. This minimum can be met via transfer of existing accounts or with new funds. A client household may generally include accounts for a head of household, a significant other, dependents, and any controlled organizations or entities.

Minimums do not apply to inStream proactive financial planning as a stand-alone service.
ANNUAL FEE
Assets Under Management Fee as a % of AUM
$100,000 - $249,999 1.00%
$250,000 - $499,999 0.90%
$500,000 - $999,999 0.80%
$1,000,000 - $1,999,999 0.65%
$2,000,000 or more 0.50%

inStream proactive financial planning as a stand-alone service: $1,000/year or $100/month
MINIMUM ACCOUNT SIZE
There is a minimum initial investment of $100,000 per Strategy:FOCO client household. This minimum can be met via transfer of existing accounts or with new funds. A client household may generally include accounts for a head of household, a significant other, dependents, and any controlled organizations or entities.

Minimums do not apply to inStream proactive financial planning as a stand-alone service.
ANNUAL FEE
Assets Under Management Fee as a % of AUM
$100,000 - $249,999 1.00%
$250,000 - $499,999 0.90%
$500,000 - $999,999 0.80%
$1,000,000 - $1,999,999 0.65%
$2,000,000 or more 0.50%

inStream proactive financial planning as a stand-alone service: $1,000/year or $100/month
MINIMUM ACCOUNT SIZE
The minimum initial investment for the Invest:FOCO platform is only $5,000 per account. This minimum can be met via transfer of an existing account or with new funds. Invest:FOCO is currently available for Individual, Joint, Traditional IRA, and Roth IRA registrations.
ANNUAL FEE
0.65% of assets under management ($65 per $10,000 managed)
MINIMUM ACCOUNT SIZE
The minimum initial investment for the Invest:FOCO platform is only $5,000 per account. This minimum can be met via transfer of an existing account or with new funds.
ANNUAL FEE
0.65% of assets under management ($65 per $10,000 managed)
TAX PREPARATION
Invest:FOCO clients are eligible for a 10% discount on income tax preparation services offered through Fort Collins Tax Service, LLC. This discount applies to the base cost for return preparation as well as Schedules B & D. More details can be found here.
MINIMUM RELATIONSHIP SIZE
There are no minimums when utilizing inStream proactive financial planning as a stand-alone service.

When investment management services are desired, there is a minimum initial investment of $125,000 per Strategy:FOCO client household. This minimum can be met via transfer of existing accounts or with new funds. A client household may generally include accounts for a head of household, a significant other, dependents, and any controlled organizations or entities. inStream proactive financial planning is then included at no additional cost.
ANNUAL FEE
inStream proactive financial planning as a stand-alone service: $1,250/year or $125/month

Assets Under Management Fee as a % of AUM
$125,000 - $249,999 1.00%
$250,000 - $499,999 0.90%
$500,000 - $999,999 0.80%
$1,000,000 - $1,999,999 0.65%
$2,000,000 or more 0.50%
TAX PREPARATION
Strategy:FOCO clients are eligible for a 50% or 100% discount on income tax preparation services offered through Fort Collins Tax Service, LLC. This discount applies to the base cost for return preparation as well as Schedules B & D. More details can be found here.
Monthly Economic Update
Stay in the loop with our Monthly Economic Update. It's a great way to catch up on the things effecting your financial plan in an easy to read and relatable format.

We promise to only use your name and email address for sending our Monthly Economic Update. We will not sell, rent, lease, loan, or use your name or email address for any other purpose, internally or externally. You can easily unsubscribe at any time.
Monthly Economic Update
Stay in the loop with our Monthly Economic Update. It's a great way to catch up on the things effecting your financial plan in an easy to read and relatable format.

We promise to only use your name and email address for sending our Monthly Economic Update. We will not sell, rent, lease, loan, or use your name or email address for any other purpose, internally or externally. You can easily unsubscribe at any time.
MINIMUM ACCOUNT SIZE
Minimums do not apply to always-on, real-time financial planning as a stand-alone service.

For investment management services there is a minimum initial investment of $125,000 per Strategy:FOCO client household. This minimum can be met via transfer of existing accounts or with new funds. Investment management fees are generally debited from the accounts to which they apply. Financial planning services are included for Strategy:FOCO investment management clients at no additional charge.
ANNUAL FEE
Always-on, real-time financial planning as a stand-alone service:  $125/month or $1,250/year

Assets Under Management Fee as a % of AUM
$125,000 - $249,999 1.00%
$250,000 - $499,999 0.90%
$500,000 - $999,999 0.80%
$1,000,000 - $1,999,999 0.65%
$2,000,000 or more 0.50%
Five Savings Secrets
Are you 30 - 60? Let us give you a few tips with our free white-paper: Five Savings Secrets. Then stay in the loop with periodic emails featuring relevant information on financial planning, investment management, and income taxes.

We promise to never sell, rent, lease, loan, or use your email address for any other purpose, internally or externally. You can easily unsubscribe at any time.
Notice

This website or its third-party tools use cookies, which are necessary to its functioning and required to achieve the purposes illustrated in the privacy policy. If you want to know more or withdraw your consent to all or some of the cookies, please refer to the privacy policy.

By closing this banner, scrolling this page, clicking a link or continuing to browse otherwise, you agree to the use of cookies.

FINANCIAL PLANNING
Financial planning services are ongoing, and include unlimited phone, email, web and in-person meeting and consultation time. Pricing is based on the unique circumstances of each client situation. Generally, there is a one-time plan development fee ranging from $500 - $2,000 and a monthly fee of $150 - $500; cancel anytime. Clients utilizing investment management services with portfolios of $500,000 or more will typically receive financial planning services for no additional fee.
INVESTMENT MANAGEMENT
Assets Under Management (AUM) Annual fee as % of AUM or flat-dollar
$0 - $249,999 1.00%
$250,000 - $499,999 0.90%
$500,000 - $999,999 0.80%
$1,000,000 - $1,999,999 0.65%
$2,000,000 - $2,999,999 0.50%
$3,000,000 - $3,999,999 $15,000
$4,000,000 - $4,999,999 $20,000
$5,000,000 or more $25,000 + $2,000 per additional $1mm
ESTIMATE YOUR FEE
Your fee is determined by the complexity of your needs and situation. The primary proxy we use for complexity is your investable net worth, which is generally your total net worth, excluding your primary residence. Your investable net worth includes the value of cash, bonds, stocks, mutual funds, rental real estate, and other business or financial interests. This aligns with the holistic nature of our comprehensive services. You can use the chart below to estimate your fee based on your investable net worth. In some circumstances, your fee may be more than the minimums in the chart below.
Annual Fee Investable Net Worth (INW)
$4,000 (minimum for an individual) Up to $500,000
$6,000 (minimum for couples) Up to $1,000,000
$8,000 Up to $1,500,000
$10,000 Up to $2,000,000
$11,000 Up to $2,500,000
$12,000 Up to $3,000,000
+ $1,000 per additional $1,000,000 of INW
Critical Money Tips
Need some tips to help you tackle your next critical money moment? Stay in the loop with our weekly(ish) email!

We promise to never sell, rent, lease, loan, or otherwise use your email address for any reason inconsistent with our privacy policy. You can easily unsubscribe at any time.
Critical Money Tips
Need some tips to help you tackle your next critical money moment? Stay in the loop with our weekly(ish) email!

We promise to never sell, rent, lease, loan, or otherwise use your email address for any reason inconsistent with our privacy policy. You can easily unsubscribe at any time.
Critical Money Tips
Need some tips to help you tackle your next critical money moment? Stay in the loop with our weekly(ish) email!

We promise to never sell, rent, lease, loan, or otherwise use your email address for any reason inconsistent with our privacy policy. You can easily unsubscribe at any time.
Critical Money Tips
Need some tips to help you tackle your next critical money moment? Stay in the loop with our weekly(ish) email!

We promise to never sell, rent, lease, loan, or otherwise use your email address for any reason inconsistent with our privacy policy. You can easily unsubscribe at any time.
Critical Money Tips
Do you have a cash surplus? Learn more what to do with extra money in the free-preview of our Teachable course: Sudden Money and Windfalls.

We promise to never sell, rent, lease, loan, or otherwise use your email address for any reason inconsistent with our privacy policy. You can easily unsubscribe at any time.
Critical Money Tips
Are you here because of a big change in your finances? Subscribe for our PDF on 6 questions to learn the benefits of working with a full-time fiduciary.

We promise to never sell, rent, lease, loan, or otherwise use your email address for any reason inconsistent with our privacy policy. You can easily unsubscribe at any time.
Inheriting Money Can Be Overwhelming.
We have the expertise to be your guide as you navigate receiving a windfall.
Equity Compensation Can Be Confusing.
Let us make it less complicated for you. Whether it’s a one-time award or ongoing compensation, we know how to help.
Critical Money Tips
Need some tips to help you tackle your next critical money moment? Stay in the loop with our weekly(ish) email!

We promise to never sell, rent, lease, loan, or otherwise use your email address for any reason inconsistent with our privacy policy. You can easily unsubscribe at any time.
ESTIMATE YOUR FEE
Your fee is determined by the complexity of your needs and situation. The primary proxy we use for complexity is your net worth, which is the value of what you own — including cash, bonds, stocks, mutual funds, real estate, and other business or financial interests — minus what you owe. Our transparent, flat-dollar pricing aligns with the holistic nature and value of our comprehensive services. You can use the chart below to estimate your fee based on your net worth. In some circumstances, your fee may be more than the minimums in the chart below.
Annualized Flat Fee Net Worth (NW)
$6,000 (our minimum fee) Up to $1,000,000
$8,000 Up to $1,500,000
$10,000 Up to $2,000,000
$12,000 Up to $3,000,000
+ $1,000 per additional $1,000,000 of NW
FEE SCHEDULE
Unless there is truly unique or extraordinary complexity associated with a client’s situation and financial circumstances, our fee will be based on the market value of the assets under management (AUM) for investment management services, subject to a minimum fee. The fee is blended and calculated using the following schedule. We do not require a minimum investment of any amount.
Assets Under Management Annual Fee
$0 - $1,000,000 $6,000
$1,000,000 - $3,000,000 0.50%
$3,000,000 - $5,000,000 0.25%
$5,000,000 and above 0.10%