A financial plan can be a powerful tool, giving you a clear picture of your current financial wellbeing and empowering you to lay the groundwork for your future. What's important is tailoring your plan to your unique situation.

At its root, a comprehensive financial plan includes the same key components for everyone, “but exactly what these components look like may often be different for members of the LGBTQ+ community because of their unique challenges, aspirations and lived realities,” says Charlene Quaresma, a Portland, Oregon–based wealth management advisor with Northwestern Mutual who has worked extensively with the LGBTQ+ community.

Below, Quaresma breaks down five key things that LGBTQ+ people should include in their financial planning.

    When it comes to building an emergency fund, most financial pros recommend stashing away three to six months’ worth of expenses. This will typically be enough to cover most unexpected expenses (such as medical bills, car repairs, etc.) as well as act as a life preserver in the event you find yourself unemployed.

    Quaresma suggests even more padding for her LGBTQ+ clients’ emergency funds. “I will usually recommend aiming for six to twelve months’ worth of expenses, similar to what I might recommend for self-employed individuals,” she says.

    Why? Although it is illegal for an employer to fire an employee for being gay or transgender (as of a June 2020 Supreme Court ruling that extended the protections of the Civil Rights Act to gay and transgender employees), that doesn’t mean discrimination can’t or won’t still happen. This is due, in part, to the fact that the ruling only applies to employers with 15 or more employees. Smaller employers can, theoretically, still fire an individual on the basis of sexual orientation or gender identity unless they are specifically barred from doing so by state law.

    Twenty-seven states do not have laws in place which explicitly protect LGBTQ+ individuals from employment discrimination,” Quaresma notes.

    If you have goals down the line that you want to achieve, coming up with a savings plan for them that works within your budget can help you balance getting there with other financial priorities — especially considering certain goals can be more expensive for members of the LGBTQ+ community.

    “Family planning, in particular, can often be significantly more expensive,” Quaresma explains. “Hormone therapy, in vitro fertilization, surrogacy, adoption, lactation plans — it all adds up rather quickly.”

    Quaresma also notes that members of the transgender community looking to transition may need to cover the costs of surgery or hormone-replacement therapy out of pocket if it is not covered by their health insurance. “Transitioning isn’t a goal for everyone, but if it is a goal for you then you’ll need to have these dollars saved up,” she says.

    Having the right types and levels of insurance coverage matters: disability insurance to protect your income if you can’t work for a time due to illness or injury, and life insurance if you have (or plan to have) a family or other loved ones who rely on you financially, and you want them to be protected should you pass away.

    “You’ll also want to make sure that you specifically name the beneficiaries of your life insurance policy,” Quaresma says. “This is especially important for individuals with mixed families, where couples come into the relationship either with children from a previous relationship or adopted children. Making sure that the beneficiaries are who you intend them to be, and explicitly naming them on your policy, will remove any confusion over who should receive the benefit should a claim need to be made.”

    Even if retirement is decades away, saving and investing for it now means you get the benefit of compound interest to help your money grow. Having a plan for retirement is particularly important for the LGBTQ+ community, which tends to lag in retirement savings compared with straight peers — despite retirement being a top financial concern. So calculate how much you can comfortably save now and explore your retirement saving options with an advisor.

    If you’ll spend your retirement with a partner or spouse, start discussing your visions for retirement together now. If you’re in a long-term relationship but don’t plan to get married, know the rules around claiming Social Security survivor’s benefits or other assets, such as distributions from a retirement account, after the death of a partner. Differing rules around this makes estate planning all the more important (more on that below).

    Finally, keep demographics in mind. “It’s well known that women tend to live longer than men,” Quaresma says. “Historically, women also tend to make less money over their lifetime than men do for similar work. This means that a lesbian couple might need to target a higher savings rate than a heterosexual couple, or even a couple consisting of two gay men, in order to ensure a comfortable retirement.”

    An estate plan is a crucial piece of every financial plan, as it ensures that your family is protected and that your wishes are respected in the event of your death. For LGBTQ+ individuals, many components of the estate plan take on added significance.

    For example, if you and your partner are not married, you will need to set up a durable medical power of attorney in order to note that your partner is allowed to make medical decisions for you. Without this document, if you were to become medically incapacitated, it’s possible that your partner would not be legally allowed to make decisions about your care.

    Likewise, if you and your partner have children, is one of you the biological parent? If so, has the non-biological parent formally and legally adopted the child? If this hasn’t happened and the biological parent were to die, the surviving parent may or may not automatically become the child’s guardian, depending on the laws of your state.

    “There’s a lot to consider, so it’s worth working with a financial advisor with estate planning experience who can help you cross those t’s and dot those i’s to protect your wishes,” Quaresma says.


Combining all these key components together into a comprehensive financial plan may feel a little daunting — this is where working with a financial advisor is key. Quaresma recommends seeking a professional who has deep experience working with LGBTQ+ clients. They'll ask you the right questions, and give you advice that considers your unique circumstances.

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