Planning for Retirement Remains a Challenge for the LGBTQ Community

Jul 24, 2023
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Planning for Retirement Remains a Challenge for the LGBTQ Community

Despite progress made in recent years, the LGBTQ community still faces significant challenges when it comes to planning and saving for retirement. Discrimination and financial inequality often mean this population is less prepared financially for their later years compared to straight counterparts.

About 3 million LGBTQ individuals over age 50 live in the U.S. today, and that number is expected to grow to 7 million by 2030. Currently, one-third of LGBTQ elders live at or below 200% of the federal poverty level. For a community that has experienced a lifetime of discrimination and limited opportunities, this has resulted in less financial security and fewer resources in retirement.

The LGBTQ community has also been historically underserved by financial institutions. Data shows that life in general tends to be more expensive for LGBTQ members. There is greater spending on necessities, more debt carried, and less money saved for retirement. Other financial demands like healthcare to accommodate LGBTQ-specific needs and family planning expenses also strain budgets.

Housing costs can also be a challenge. While living in LGBTQ-friendly areas isn't inherently more expensive, many do place a premium on living somewhere safe and accepting, which often means costlier urban areas. All of these factors - from healthcare to housing - carry through retirement, making planning even more difficult.

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Estrangement from family also means LGBTQ seniors often can't rely on children for caretaking and must opt for expensive at-home elder care. After a lifetime of lower earnings due to discrimination, it's challenging to save enough for these elevated retirement costs.

While progress has been made, it's clear the LGBTQ community still faces financial inequality that makes planning for retirement difficult. Continued efforts are needed to improve access to inclusive financial services and address the unique challenges this population faces in their later years.