In a subtitle to “The Evolving LGBT Financial Experience: 5 Research Insights,” the Stamford Advocate wrote, “Marriage, taxes, and estate planning have become easier. But equality may still be blamed for the income gap and financial stress.” “The LGBT Financial Experience” is a study that follows up on a report Prudential Financial conducted back in 2012. Not only is this is a community that needs to engage in financial planning but businesses that employ LGBT individuals and their loved ones need to be aware of the financial challenges members of this group face. While marriage equality may have made some processes smoother, LGBT couples still must handle financial planning issues such as estate planning and caring for their parents.
The report also found that “LGBT individuals indicated that they were more likely to consider themselves “spenders” (48 percent), compared to the general population (32 percent).” In addition to this self-reporting, the article adds: “spending patterns confirm that they do indeed spend more and save less.”
Not only did the report find that LGBT respondents were less likely to engage in financial planning, they may also have less income to work with in the first place. There is an income gap linked to sexual orientation. Lower income and a lack of financial planning may be why “LGBT respondents were more likely to say they were struggling financially than were respondents within the general population (41 percent, versus 27 percent of general population).” Respondents of varying ages reported feeling financial strain. Sometimes when people are stressed, they may try to ignore the issues instead of seeking help. Or they may be so focused on how to live on what they earn, they cannot consider their financial future, which can be a problem because LGBT seniors face retirement challenges.
Overall, the report found that there was progress. Financial security is certainly not out of reach but LGBT individuals need to become more informed and perhaps less hesitant to set financial goals and work on strategies to achieve those goals.