Bridging the LGBTQ+ Wealth Gap: Challenges and Solutions

Pride Month presents an opportunity to shine a light on the unique financial challenges faced by the LGBTQ+ community. From higher costs associated with starting a family to estate planning obstacles, LGBTQ+ individuals often navigate a financial landscape fraught with challenges. At Southover Wealth, we believe in the power of informed financial planning to help overcome these barriers and achieve financial security for everyone.

Unique Financial Challenges

LGBTQ+ individuals encounter several distinctive financial challenges that can impact their earning potential and decision-making around finances.

The financial implications of not marrying in same-sex partnerships

Some same sex partners decide not to marry or enter civil partnership, often in protest due to historical exclusions. Not marrying will impact your spousal rights in terms of pensions. If one of you dies and you’re not married, the rights to the pension may not get passed across. In this instance it is important that both you and your partner have an up-to-date Will and that the beneficiaries are updated on your pension schemes and life insurance policies.

Higher costs for family planning

For many LGBTQ+ couples, starting a family involves significant expenses. Whether couples opt for IVF or surrogacy, there can be significant financial burdens that you should factor into your financial goals and planning. Private surrogacy is available in the UK, but it is illegal to charge for it so, many people look overseas. Private IVF and overseas surrogacy involves high costs, and then you need to consider the potential impact of having children on your earnings and pensions..

Impact on earnings and savings

In many cases, a same sex female couple could feel the impact of the gender pay gap twice as hard. In addition to potential impact on earnings, LGBTQ+ people are more likely to have additional savings goals. For instance, transgender individuals may save significant amounts for surgeries, diverting funds from other savings or retirement plans. Furthermore, LGBTQ+ individuals, particularly women and transgender people, face a higher risk of suffering from mental health challenges. This could lead to unpaid absence from work or difficulty gaining or retaining employment, which could further strain their financial stability.

Navigating financial planning

There has been progress within the financial services industry but there are still difficulties LGBTQ+ individuals face when seeking financial advice. Coming out to a financial adviser who might not understand you can be challenging and might make people reluctant to seek financial advice. Furthermore LGBTQ+ individuals may not realize their financial needs differ from the broader population.

The importance of trustworthy financial advice

At Southover Wealth, we understand that navigating these unique financial challenges requires a trusted adviser who can provide tailored guidance. By working with an adviser who is knowledgeable and empathetic towards the specific needs of the LGBTQ+ community, individuals can better plan for a secure financial future.

For more information on how Southover Wealth can support your financial journey, contact us today. Together, we can plan for the future you want.

Taxation rules can change at any time and are dependent on individual circumstances.

Advice relating to Wills necessitate the referral to a service that is separate and distinct to those offered by St. James’s Place. Wills are not regulated by the Financial Conduct Authority.

SJP Aproved: 23/07/2024