Welcome to CB’s personal-finance advice column, Make It Make Sense, where each month experts answer reader questions on complex investment and personal-finance topics and break them down in terms we can all understand. This month, Jennah Cornelissen, a lead advisor at money-management platform Wealthsimple, tackles financial advice for one-person households. Have a question about your finances? Send it to [email protected].

Q: All of the financial advice I see online seems to focus on couples. But that advice doesn’t always apply to me as a person who lives alone. How different is the approach to saving and investing on a single income?

For many Canadians, the traditional financial milestones are the same: Get a full-time job, partner-up, buy a house, have kids and retire. Recently, many younger Canadians—and older ones, too—are taking things on solo. According to Statistics Canada, the number of single people between 25 and 39 (an age range considered by many to be the “prime” marrying years) increased by about seven per cent between 2018 and 2022.

Going it alone financially can be daunting—especially when so much advice is geared towards couples—but it is possible with the right strategy. Here are some tips for saving that resonate the most with my single clients: 

Create (and track!) a budget: Sticking to a budget is critical when you’re living alone, as you’re not able to split essential expenses like food, bills or rent. Building a budget is a lot like evaluating a potential partner—It’s about identifying deal breakers. Think about your needs, your wants and what you’re looking for when it comes to your financial goals. Do you need a healthy shopping, travel and entertainment budget? What are your long-term financial goals? Do you want to buy a house? When? How, and when do you plan to retire? Be honest with yourself.

Once your deal breakers are fleshed out, you can map out your budget. I recommend using the 50/30/20 rule: 50 per cent of your income is dedicated to needs (food, shelter, etc.), 30 per cent goes toward wants (things like dining out, travel, and dating?) and the final 20 per cent is for financial goals and investing, which would include a plan to pay down any debt you might have. (An advisor can help make a debt repayment plan.)

Related: How Can I Invest in Green Companies?

Create an emergency fund: Having an amount of money set aside for an emergency is critical, especially when you may not have additional financial support from a partner in the instance of a job loss or other major unexpected financial loss. I recommend clients build an emergency fund with enough money to support about three to six months’ worth of expenses. It should be in an account that you can access easily—and ideally, one that offers high interest as well.

Auto-invest a portion of every paycheque: Setting up an auto-deposit is a great way to grow your savings account. Automatically transferring a portion of every paycheque into a First Home Savings Account or a Tax-Free Savings Account makes it easier to stay disciplined and helps you a meet your financial goals. 

Diversify: Diversification in investing means to hold different asset classes (stocks, bonds, etc.), as well as securities from around the world—and not just North America. Diversified portfolios help reduce risk without sacrificing much in the way of returns. The right diversification across asset classes and geography is smart risk management, especially if you’re lacking a financial support network or don’t have anything else to fall back on in case of an emergency .An advisor can help put together a diverse portfolio that makes sense for your budget, goals and income. 

Depending on your income level, it may take longer as a single professional to save money; make big purchases, like appliances or furniture; or save up for a down payment on a home, but these goals are still achievable. By taking these steps, you’re more likely to put yourself in a better position to build wealth over your lifetime—and not be financially punished for going solo.