An overview of the unique financial challenges LGBTQ+ people continue to faceSkip to content
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Table of Contents
- A History of Discrimination
- Marriage and Family Planning
- Debt
- Insurance Issues
- Retirement
- FAQs
- The Bottom Line
By
Updated June 14, 2024
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Part of the Series
Guide to Finance for LGBTQ+ People
Lesbian, gay, bisexual, transgender, and queer or questioning (LGBTQ+) people have seen many historical, societal, and legal changes in recent years that grant them more equality and protection. Despite these advancements, they still face unique challenges, including financial ones.
Whether it is legal disparities that leave LGBTQ+ populations financially unprotected or personal finance concerns, it is important to recognize these issues. Defining the problems will help bring attention to them and build ways to address them.
This article will provide an overview of the financial issues that LGBTQ+ people face with regard to marriage and family planning, debt, insurance, and retirement—due in part to the history of discrimination against them, but also because of the unique financial challenges that come with being an LGBTQ+ person.
Key Takeaways
- Because much of the movement for the advancement of LGBTQ+ rights has occurred relatively recently, members of these communities are still learning how to cope financially with the challenges they face.
- Members of LGBTQ+ communities on average have less saved for retirement.
- LGBTQ+ people carry $16,000 more in student loan debt than their cisgender/heterosexual peers.
- Family planning for LGBTQ+ people can easily cost in the tens of thousands of dollars.
- LGBTQ+ retirees may wish to retire to accepting communities that can have higher-than-average living costs.
A History of Discrimination
It wasn’t until 2015 that gay marriage was legalized in all 50 states. And only in 2020 did the U.S. Supreme Court bar discrimination in employment decisions in relation to a person’s sexual orientation or gender identity. But these are just some of the concerns facing LGBTQ+ people.
Over time, many notable events have occurred that have helped and hurt members of LGBTQ+ communities. Below are some of the key laws and moments that have shaped the world that they face today.
- 1969: The Stonewall Uprising occurred at the Stonewall Inn, a gay bar in New York City. This uprising is often cited as a catalyst for the beginning of the LGBTQ+ rights movement.1
- 1974: The Equal Credit Opportunity Act (ECOA) of 1974 prohibits discrimination in lending based on race, color, religion, national origin, sex, marital status, age, or the receipt of public assistance, but omits any mention of sexual orientation or gender identity.2
- 1977: Harvey Milk is elected to the San Francisco Board of Supervisors. He was one of the first openly gay elected officials. He was assassinated after serving less than a year in office.3
- 1988: The Fair Housing Act, originally passed in 1968 and amended in 1988, protects Americans from discrimination based on race, color, national origin, religion, sex, family status, and disability, but omits any mention of sexual orientation or gender identity.4
- 1994: “Don’t Ask, Don’t Tell” is instituted, a policy that banned openly gay and lesbian members of the military from serving in the U.S. armed forces.5
- 2009: Then-President Barack Obama signs a Presidential Memorandum that allows same-sex partners of federal employees to receive benefits, but it does not cover health benefits.6
- 2010: The “Don’t Ask, Don’t Tell” policy is repealed, allowing gay and lesbian people to serve openly in the U.S. military.7
- 2015: Same-sex marriage is legalized in all 50 U.S. states by the U.S. Supreme Court ruling in the case of Obergefell v. Hodges.8
- 2019: The Fair and Equal Housing Act of 2019 was introduced in the U.S. Senate. The bill would have provided protection from discrimination in credit lending in relation to sexual orientation and gender identity. It did not receive a vote. To date, the bill has not been reintroduced.9
- 2020: The U.S. Supreme Court ruling in the case of Bostock v. Clayton County bars discrimination in employment decisions in relation to a person’s sexual orientation or gender identity.10
- 2021: The Consumer Financial Protection Bureau (CFPB) clarifies that the ECOA includes protections for LGBTQ+ people, making it illegal to discriminate on the basis of gender identity or sexual orientation.11
- 2023: The American Civil Liberties Union (ACLU) tracks about 500 anti-LGBTQ bills in state legislatures across the U.S. These laws target freedom of speech and expression, the safety of transgender students, and access to healthcare, among other rights.1213
The monumental changes outlined above give a glimpse of the struggles LGBTQ+ communities have endured and the victories they have achieved. Because some rights and protections, such as marriage and workplace protections, have only been granted in recent years, many members of LGBTQ+ communities are still impacted by the long period of time without them.
These milestone events have had substantial ramifications for LGBTQ+ people in relation to finance. Whether it was leaving out protections against discrimination or granting rights (such as health coverage and marital status tax and other benefits), these events shaped the financial future for LGBTQ+ people.
Here’s a look at the major financial issues that LGBTQ+ people may encounter.
Marriage and Family Planning for LGBTQ+ People
The right to legally marry drastically changed the landscape for LGBTQ+ people. With the right to marry came spousal benefits through Social Security, pensions, and work.
Married couples receive important tax benefits, including eligibility to file taxes jointly and the ability to avoid a tax burden when receiving payouts from a deceased partner’s retirement plan.
With or without marriage, LGBTQ+ people face financial challenges when it comes to family planning. There are many options for an LGBTQ+ person to start a family—including adoption, in vitro fertilization (IVF), surrogacy, and artificial insemination—all of which are costly.
For example, adoption can cost $20,000 to $70,000, depending on whether the adoption is done domestically or internationally. IVF can cost $13,500 to $21,000 or more, and thousands more per attempt.14
Depending on the type used, surrogacy can cost from less than $60,000 to more than $250,000.
Paying these costs is difficult for almost any couple or individual. The difference is that almost all LGBTQ+ people face these obstacles when choosing to start a family. This can cause financial and emotional strain.
On top of this, some states do not
