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The LGBTQ Community Faces Many Financial Challenges — Here’s How to Overcome Them

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

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Getting your financial house in order is a tough chore, regardless of your circumstances. But when you’re in the LGBTQ community, it can be even harder. Systemic discrimination, emotional and familial struggles, and sometimes the inability to start a family biologically, can bring additional financial challenges.

“People often ask us what makes queer money different,” said David Auten, who with his husband John Schneider, runs the Debt Free Guys blog and Queer Money podcast. They believe 80% of money is the same for everyone — the basic transactional aspects like spending, saving and investing.

“There’s 20% that is specific to who we are, who we love, where we live and the family structure that we have, and in many cases, the legacy emotional aspects that we bring into life,” Auten said. Growing up being ostracized or bullied creates emotional wounds that can last for a lifetime, prompting people to overspend in attempt to make showy displays of wealth to prove self-worth, he said. “In our opinion, that has a much bigger role in how we interact with money than the other 80%.”

It takes some extra effort to understand what these challenges are and how to overcome them, but it can be done. If you’re in the LGBTQ community and you need to improve your financial situation, here’s what you need to know.

Discrimination is a major barrier to financial success for the LGBTQ community

The LGBTQ community is up against numerous disadvantages that present financial challenges, said Mariam Adams, a Merrill Lynch Wealth Management advisor in New York City whose practice focuses on the LGBTQ community.

These struggles often start in adolescence, Adams said, since some LGBTQ youth have unsupportive families and are much more likely to end up homeless. Adams’ parents were from Afghanistan and did not have LGBTQ in their vocabulary. She grew up as a closeted lesbian. Not knowing how her family would react to her coming out, she made sure she was financially secure first in case she was cut off. “I don’t think my friends were going through that struggle at the time,” she said.

One in four LGBTQ people have experienced employment discrimination in the last five years, and it’s worse for the transgender community, according to Out & Equal. Transitioning in and of itself can be expensive, but fears of being fired from a job or denied housing simply for being LGBTQ — which is still legal in dozens of states — add more pressure.

Nearly 53% of the LGBTQ community report discrimination negatively affecting their work environment, and this discrimination can be seen in reports of lower income for LGBTQ people than the general population, Adams said. Plus, the gender gap persists; LGBTQ women earn even less than LGBTQ men. And if someone wants to live in a more LGBTQ-friendly city like New York or San Francisco, she said, that adds extra costs, making it even harder to get by.

LGBTQ people also tend to spend more than non-LGBTQ people, Adams said, and they’re less knowledgeable about finances and don’t take as much advantage of financial products or advisors. She said working with a financial professional can make people feel vulnerable and exposed, and not everyone in the LGBTQ community trusts that someone at a financial institution will know how to — or be willing to — help them.

All of these factors take a toll — a recent survey commissioned by the podcast Team Nancy and conducted by polling firm Morning Consult found that 52% of self-identified queer people feel anxiety around their finances, and 25% say their sexuality or gender has impacted their finances. A separate survey by MassMutual found that nearly half of LGBTQ workers between the ages of 25 and 65 did not feel financially secure, compared to 37% of non-LGBTQ people.

Feeling discouraged? Take a deep breath: here’s what you can do about it.

7 ways the LGBTQ community can overcome financial challenges

Get to the root cause of spending

You might think the first way to get your financial house in order is to make a spreadsheet and a budget, but until you address your subconscious beliefs and emotions around money, it’s hard to make any real progress, Schneider said.

So many people in the community have been ostracized, bullied or picked on when growing up, he added, which results in many limiting beliefs about “who we are, what we’re worth and whether or not we’re validated by society.”

After Schneider and Auten paid off $51,000 in credit card debt, they had an epiphany about their spending. “We started to realize one of the reasons why we got into so much debt is we were making up for feelings of inferiority, making up for being bullied and picked on when we were kids, making up for the fact that our families and our churches, our classmates and everyone in our lives basically were reminding us over and over again that because we were gay, we just weren’t good enough,” Auten said. “One of the easiest ways to prove that you’re a good person in this country is to show you have wealth and financial means.”

The couple had 13 years of combined experience in financial services when they finally confessed to each other that they were each struggling financially. “In theory, we knew better, but we were sabotaging ourselves financially, mostly because the 20% that most affected us was that limiting belief that we weren’t really good enough,” Schneider said. So take the time to examine any limiting beliefs or lingering emotions that might be holding you back or causing you to overspend. Meet with a mental health or financial professional if you need help digging deep.

Know your health access barriers — and insurance rights

The Affordable Care Act and recent supreme court rulings have increased access to health insurance and healthcare for many in the LGBTQ community. Regardless, discrimination, and past negative experiences with healthcare professionals have caused some LGBTQ individuals to delay access to needed medical care. To help you find a health care provider you feel comfortable with, there’s a provider directory from Health Profesionals Advancing LGBTQ Equality (formally the Gay and Lesbian Medical Association) that lists practitioners considered to be LGBTQ-friendly.

For transgender individuals looking to transition, hormone replacement therapy can also be difficult to obtain. However, if you have health insurance, be aware that under federal law, it’s now illegal for health insurance to exclude transition-related care. While this doesn’t mean an employer has to fully cover every procedure, you may be able to get exceptions if you show that it’s medically necessary. If you face denial or discrimination from a health insurer or medical practitioner, speak up — the National Center for Transgender Equality suggests a variety of options for recourse if you can’t get quality care. Also, if you aren’t able to afford health insurance, there are clinics around the country, including some Planned Parenthood locations, that offer affordable hormone replacement therapy.

Financially plan to start a family

If you want to have kids and aren’t able to biologically, prepare in advance due to the massive cost, Adams said. If you don’t, it can result in significant debt. She helps her LGBTQ clients save and invest for family planning, and she said it’s crucial to start setting aside and investing money as soon as possible so it can grow through compound interest.

She recommended setting up a separate investment plan specifically for this purpose. Also, it’s ideal to meet with a financial advisor or planner who can help you assess the best way to invest since it will vary depending on how much time you have and how much money you ultimately need.

Adams has found that public adoption through foster care can cost from nothing up to nearly $3,000, but people who go through a private adoption agency can spend anywhere from $40,000 to $60,000.

For lesbian couples in which one wants to carry a baby, intrauterine insemination (IUI) can cost about $3,000 per try, Adams said; that’s what she and her wife had to pay since their insurance didn’t cover it. If that doesn’t work, or if one partner wants to carry the other’s egg, you can try in vitro fertilization, but this is much more expensive. Adams and her wife used this method for their second pregnancy, and it cost them around $30,000 including all of the medications and appointments. In both cases, couples often have to try more than once before they have success. For male couples who want to use a surrogate to have a biological child, Adams typically advises a budget of $125,000 for the entire process, and she’s never seen it cost less than $100,000 total.

An increasing number of companies now offer infertility benefits in their health insurance, Adams noted. However, if the same-sex couple isn’t actually medically infertile, Adams said, some insurance providers won’t cover these services, so don’t assume you have these benefits. Adams recommended talking to your HR department to determine your benefits and push for better ones if they’re lacking.

Additionally, if you’re in a same-sex relationship and you’re not biologically related to your child, it’s recommended to take action to become a legal parent. While some states presume you are a parent if you and your spouse were married when the child was born, the National Center for Lesbian Rights recommends all same-sex couples with children establish a legal connection between parent and child, especially if the child was adopted, so that both parents have full legal rights and can make decisions for the child. It also makes estate planning easier if you are the legal parent, especially if you don’t have a will (but you should get a will!).

Get on the same page as your partner

If you’re coupled up, it’s vital that you talk to your partner about money. Auten said his audience often shares that they struggle to talk about finances with their partners and sometimes avoid it altogether. He’s not surprised — it took him and Schneider about a year and a half into their relationship to finally get comfortable enough to share where they stood financially.

“If you’re not on the same page as the person you make financial decisions with, you’re never going to be able to get very far down a road of progress,” Auten said. “If you’re a saver and they’re a spender and you put your money into the same account, well, you’ll probably never end up actually saving money.”

Not sure how to broach the subject? “One of the things that we encourage is that individuals start the conversation with their partner in a very non-confrontational way, talking about their hopes and dreams, what they want their future life to look like, or some of the fun things they really want to do together as a couple,” Auten said. Rather than focusing on how to pay off debt, for example, he said instead start by focusing on what the two of you want your life to look like in a year or three years and make a game plan for your debt from there.

If you and your partner aren’t married yet, Adams suggested considering it. While some in the LGBTQ community don’t feel the need to follow the traditional path of marriage, she said, it can be very beneficial from a financial planning perspective. Since marriage equality came into play, same-sex spouses can file taxes jointly, inherit each other’s money without paying estate taxes and receive their spouse’s Social Security, VA and pension benefits. These perks can be helpful for your family’s finances, Adams said.

Attack your debt

It’s hard to save for emergencies and invest in your future if you’re drowning in debt, so it’s key to get it under control. While the snowball and avalanche methods are common tactics to get out of debt, Auten said, he and Schneider don’t believe they’re the most effective.

“Neither the avalanche or snowball focus on eliminating the biggest hurdle to your debt, especially when it comes to credit card debt, and that is eliminating or reducing the interest payments that you’re making,” Auten said. “Both of those methods are designed around either paying off the largest balance or the highest interest first.” However, Auten said when the pair had $51,000 in credit card debt, they realized they were paying $10,000 a year in interest alone. “We just knew that there was no short-term path to progress for us if we continued to pay that massive amount of interest,” he said.

Instead, they created their own method, “the debt lasso method,” which they said entails intelligently refinancing debt so you can pay off more of your principal balance. They encourage people to “lasso” all of their consumer debt into as few locations as possible. Ideally, you could consolidate your debt under one balance transfer credit card with 0% interest, which allows you to expedite your ability to pay off debt, he said.

Utilize free resources

If you’re feeling overwhelmed, there’s plenty of free help out there. Auten and Schneider recommended finding personal finance blogs and podcasts you can relate to — whether its theirs or one of the many others available — to start educating yourself and learning money best practices.

Schneider recommended looking for a Capital One Café in your area (you can search for locations online). You don’t have to have an account with them to get up to three free money coaching sessions. They don’t do hard pressure sales on you, he said, and they guide you through emotions and limiting beliefs around money. If you’re struggling to get on the same page as your partner financially, they can also serve as a helpful intermediary, Schneider said.

If debt is a big issue for you, you could also set up a free consult with a credit counselor to assess your situation. There are also digital financial tools that can help, such as budgeting apps like Mint and savings apps like Qapital.

Find an expert

If you need help beyond that, consider meeting with a certified financial planner, who can help you identify goals, create a budget and devise a big picture plan to get you on track. If you have money that you’re not sure how to best save or invest, you could meet with a wealth advisor like Adams, who invests money for clients based on their goals. There are several different fee structures out there; some planners charge a flat fee or hourly fee. If someone is managing your investments, they typically charge a percent of the assets being managed.

Being an LGBTQ person in America poses many challenges that can create financial stress. But being aware of the most common issues and taking steps to overcome them and achieve financial security can make life a lot easier.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Emily Starbuck Gerson
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Emily Starbuck Gerson is a writer at MagnifyMoney. You can email Emily here

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Study: Millennials Depend on the Bank of Mom and Dad

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Millennials are advancing steadily into middle age. But statistically speaking, America’s largest generation retains one characteristic of their youth: Widespread dependence on their parents to help pay the bills.

A new survey reveals that even millennials who think of themselves as independent on money matters still hit up their parents for regular, recurring expenses. Of those surveyed, 54% claimed they stood on their own two feet, but when pressed a further 30% of those admitted to leaning on their parents to help cover costs on everything from groceries to car insurance.

The costs being covered by parents

For the most part, millennials aren’t hitting up their parents for cash to cover extravagant, one-off charges like airfare for an Instagram-worthy vacation. Instead, the survey found millennials ask mom and dad for help making ends meet for living expenses, such as the phone bill, food and rent. For example, of the millennials who receive monthly help from their parents, 48% of respondents say the money helps cover the phone bill. A more detailed breakdown can be seen in the graph below:


Besides these day-to-day costs, emergency spending requires a call home for some millennials. About 15% of all survey respondents said they would need help from their parents to cover a sudden $1,000 expense. Instead, most would opt to use either cash or savings, provided those savings weren’t earmarked for retirement in a tax-advantaged account.

Millennial money worries

Dipping into your emergency fund to repair a hole in the ceiling is a good strategy (and a reason why you save), while making a withdrawal from your savings account to pay for a bottle of rosé is not. Unfortunately a staggering 70% of millennials surveyed admitted to using savings to cover non-emergency expenses.


To use a favorite phrase of millennials, “this is problematic.” A savings account can only be drawn upon six times a month via debit card or check (due to federal regulations) and you don’t want to waste one of your six free withdrawals to pay for a pint of Americone Dream. Even worse, the money spent on non-emergency expenses won’t be there when you need it to pay for an unexpected, urgent cost.

Another metric of financial health where millennials could stand to improve is retirement savings. While 58% of the millennials surveyed claimed to save money with either each paycheck or once a month, 44% don’t have any sort of retirement savings account — either a private one or through work.


To be fair, millennials aren’t exactly celebrating these personal finance failures. Approximately 57% said they regretted how they’ve spent money from their savings account, and a little over 36% said that during the past week, they felt anxiety about their finances every single day.

The numbers behind the stress

A significant financial worry on millennials’ minds is not having enough money. While we’re pretty sure everyone, regardless of age, would like to have more money, a recent study by the Federal Reserve underscores that millennials are particularly hard-strapped for cash.

Titled “Are Millennials Different?”, the report found when compared to members of Generation X and Baby Boomers when they were roughly the same age as today’s millennials, the millennials have less means to deal with their financial challenges.

As the authors of the report put it in the conclusion of the report, “We showed that millennials do have lower real incomes than members of earlier generations when they were at similar ages, and millennials also appear to have accumulated fewer assets. The comparisons for debt are somewhat mixed, but it seems fair to conclude that millennials have levels of real debt that are about the same as those of members of Generation X when they were young and more than those of the baby boomers.”

How can millennials do better?

Besides winning the lottery, what else can millennials do to improve their financial situation and rely less on their parents?

“Many millennials are skeptical of the market,” said Dallen Haws, a financial planner based in Arizona. “Although it’s good that they are not investing willy-nilly, it will be very important that they get comfortable with investing to be able to reach their full financial potential.” Read more on how millennials (and everyone else) can start investing with an eye toward retirement.

Millennials should also embrace the power of austerity. That doesn’t mean living like a monk, but it does mean thinking twice (or thrice) about making big-ticket purchases and whether or not they are affordable.

“Without question, the biggest regret amongst millennials I work with is overpaying for a car,” said Rick Vazza, a CFA/CFP based in San Diego. “Some of my most successful young members have happily continued holding on to inexpensive cars allowing them to funnel more money toward travel, retirement funds or a down payment.”

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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7 Ways to Cool Down Summer Spending

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

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Summer is here and that means a few different things: battles with kids over sunscreen application, increased outdoor activities and a strained bank account. According to a 2018 study from LendEDU, the average adult American spends $2,229 during the summer, making it the second-most expensive season behind winter.

After being stuck inside your house for most of the colder months, it’s only natural to get excited about the outdoors and going on vacation. Unfortunately, leaving the comfort of your couch increases your expenses. Here are some tips to help you navigate the hotter months of the year without breaking a sweat.

Manage vacation expectations

One of the best ways to be able to afford a summer vacation is to work it into your yearly budget ahead of time. Steve Zakelj, a certified financial planner with Flatirons Wealth Management in Boulder, Colo. explained that a good vacation starts with planning.

“Start saving for it with $100, 500, $1,000 a month in the winter,” he said. “Set up a vacation account that gets an automatic deposit every month of the year. This way, you’re prepared for your summer trip and have a definitive budget you can use without guilt or long-term problems. Keep the monthly contributions going year-round so you’re already saving for next summer’s fun the moment you get back.”

Once you have your budget set, research places that are within your price range. If you love traveling overseas, try staying at budget-friendly, off the beaten path locations, like Sophia, Bulgaria. The average price of a hostel in Bulgaria’s capital is just $6.99 per night.

You can also keep your traveling costs low by thinking ahead. If you’re going to be out on the town a lot, there’s really no need to book an expensive hotel. If you are thinking the more activities the better, pick out ones that are affordable. “At your destination, look for free or cheap shows, events or festivals as opposed to venues that require the purchase of a pricey ticket,” explained Zakelj.

Another way to reduce vacation expenses is to stay put for a staycation. Plan local activities, hit up your favorite restaurant. Cutting out travel and accommodation expenses will allow you to funnel your money to some fun around town.

Get creative with child care

Having your kids home from school can make summer expensive, especially if you need to pay for child care. First, try asking other parents what their plans are — they may be privy to information about affordable camps or summer clubs you didn’t know existed. You may also find someone with a flexible schedule who can share child care duties with you. You take the kids one week, they take them the next and that frees up time for both of you to get stuff done without paying for day care or babysitters.

If you have relatives or your parents live nearby, see if it’s possible for your kids to visit for a week or two during the summer. Your loved ones get the benefit of seeing your kids, and you get the benefit of a free week of child care.

The YMCA is also a great source for affordable summer camps. This organization operates more than 1,850 day camps across the country. Search the YMCA site to find a camp near you.

When you do have the kids around, there are countless low-cost activities to keep them busy. “Enjoy the outdoors on the cheap,” suggested Zakelj. “Take hikes, go fishing, ride bikes, etc.  After an initial expense, most of these activities can have very low ongoing expenses.”

Pause your subscriptions

According to a study by tech consulting firm Waterstone Management Group, the average adult American spends $237.33 per month on subscription services. Summer, with its long days and beautiful weather, presents a great time to cut back on these costs. Are you running outside more? Consider canceling or pausing your gym membership. Find yourself hanging out with friends more often than sitting at home binge-watching TV shows? Cancel your Netflix account until the fall.

Take some time and comb through your bank account statements to find the subscription charges. Then, go through each one to see if you actually use it and if it truly adds value to your life. If you the answer is “no” to any of the services, cut away.

Don’t overdo it on the air conditioning

As the days get hotter and hotter, keep in mind that one big budget buster is your power bill. The Department of Energy says that air conditioners cost American homeowners about $29 billion annually. If you keep the AC cranked day and night, that’s a lot of money down the drain.

Instead of cooling an empty house, invest in a programmable thermostat that you can keep 7 to 10 degrees hotter than the setting you keep it at when you’re home. Doing this will save you about 10% on your power bill annually. If your AC unit is outdated, it might make sense to purchase a new, high-efficiency unit. Before you take that plunge, do some research on smart ways to finance the purchase.

Beyond taking steps to reduce energy costs with your AC unit directly, you can install ceiling fans to help circulate air. Consider planting leafy plants outside of your home (especially near windows), as they’ll shade your home and help keep it cool.

Take advantage of BBQ weather

You can avoid overspending during the summer by cutting back on dining out. The average American household shells out $2,667 on food costs outside of the home. The weather is nice and the days are longer, so why not have friends over to your place instead of going to a restaurant? As Zakelj explained, even reducing smaller expenses will help you keep spending under wraps.

“If you eat out regularly, think about eating your dinner at home and just going out for ice cream afterward,” said Zakelj. “You still get the fun of a trip out but just buying dessert is much cheaper than paying for an entire meal. Or have friends over to the back patio for BBQ and beer instead of hitting restaurants with them.”

Be realistic about wedding season

One big reason for summer overspending is weddings. According to wedding marketplace The Knot, the average amount guests spend on an out-of-town wedding is a whopping $901, including travel, attire, accomodations and gifts.

If you have to attend, save some cash by searching for cheap lodging. Check sites like HotelTonight.com for deals on rooms, or consider splitting the cost of a house through Airbnb or Vrbo. If you’re traveling alone, see if there’s another single friend with whom you can split a room. If you opt for a hotel, try to stay at the one reserved by the bride and groom — it’s common for the couple to request a block of rooms for their guests, often at a rate lower than listed prices.

As for traveling to the wedding, if it’s within driving distance, see if anyone wants to carpool to save on gas costs. Look into Amtrak, as it often has deals when you travel with multiple companions. Some airlines, like Southwest and United Airlines, also offer group rates, but you’ll need at least 10 people to take advantage of them.

While we all like to look spiffy for big events, there’s no need to break the bank on your wedding attire. Need a tux? Rent one from a site like TheBlackTux.com, which lets you try one on for free. Looking for a dress? Try RentTheRunway.com, where you’ll get 20% off your first rental.

Also, keep in mind: You don’t have to attend a wedding simply because you were invited. If the cost is high, ask yourself if you’re really that close to the couple getting hitched. If you’re not, skip it and send a gift instead.

Speaking of gifts: The earlier you buy from the wedding registry, the better. There will be plenty of options available, giving you the chance to purchase something the couple wants that’s well within your budget. If there’s not something affordable on the registry, ask other guests if they want to purchase a larger item together.

Beware of summer sales

There are plenty of sales during the summer — from July 4 weekend to back-to-school — but that doesn’t mean you need to hit every one. Take an inventory of all the items you already have, like notebooks and pens from the previous school year, or kids swim apparel that will still fit next summer. Once you know what you have, you can make a list of what you actually need. Let that list be your guide to summer sales. If it’s on the list, look into the sale. If it’s not, move along. Having a concrete reminder of the things you need will help you avoid spontaneous purchases that can derail your long-term savings goals.

The bottom line

It can be easy to overspend during the summer, but there are plenty of ways to avoid it. You just have to take the time to think through purchases, do some research and plan wisely. Dedicate yourself to streamlining your spending and you’ll see autumn arrive with your budget intact.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Chris O
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Chris O'Shea is a writer at MagnifyMoney. You can email Chris here

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