Financial Literacy Basics for LGBTQ+ Individuals

In Partnership With Jennifer Barrett, Comerica Bank LGBT Business Resource Group Chair

No matter how much you earn, financial literacy is an essential life skill. Financial issues impact all people, and members of the LGBTQ+ community face disproportionate challenges.

According to a recent survey published by Experian, 62% of LGBTQ+ respondents said they experienced financial problems as a direct result of their gender identity or sexual orientation. From harassment at work to being passed over for a job or facing higher housing costs due to discrimination; LGBTQ+ people are at an acute risk of dealing with financial instability.

There is also evidence of an LGBTQ+ pay gap. The Human Rights Campaign Foundation found that LGBTQ+ workers earn 90 cents for every dollar the typical worker earns, with trans women earning only 60 cents for every dollar the typical worker earns.

Despite these challenges, making smart decisions can make a big difference. In partnership with Comerica Bank, here are important financial basics for LGBTQ+ individuals.

Track your spending

One of the first steps in taking care of your personal finances is to make a budget and follow your own spending. Tracking income and costs - like in a banking app or even an (old school) checkbook - can be a powerful way to understand where your money is going. And don’t forget to check your monthly statement to make sure all of those expenses were even yours.

Checking your statement should also include something realer than “just cut back on the coffees” rhetoric: watch for small, recurring expenses. How many subscriptions do you have going? If you’re not sure, it might be time to use your newly-made budget to remind yourself of what you’re paying for.

Many LGBTQ+ people say they are big spenders. According to research from Experian, 34% of LGBTQ+ people agree that they have bad spending habits, with many gay men aged 25 to 34 admitting to overspending when it comes to clothing, grooming and personal care.


It’s called personal finance

There’s a couple of ways to improve your personal financial circumstances, including saving, managing your credit, and being smart about your debts. Not all debt is bad debt — but it is important to stay on top of it. LGBTQ+ families have an average credit card debt of $12,085, 16% higher than the average American family. Credit cards cost interest every month when you carry an ongoing balance.

Setting up an emergency savings pot for unexpected costs can help you stay in control of your finances when challenges arise. Cars break down. The air conditioning decides it’s done. Potholes in January… You get the idea. Just as importantly, if you work for an employer that does not provide protections for those who identify as LGBTQ+, it’s essential to have a financial cushion to fall back on should the worst happen.

The sooner a plan is put in place to deal with outstanding debt, the sooner it can be dealt with. Failing to pay down credit cards can damage your credit score, which makes it more difficult to obtain low-cost credit in the future. If you're not able to pay off your credit card balance in full each month, try cutting back on unnecessary spending and focus on paying as much as possible to eliminate this expensive form of lending.

Consolidate and ask for help

If cutting costs immediately is not an option, consider consolidating high-interest debt with a single lower-cost loan or 0% interest offer (if you’re eligible). Compare your debt and their interest rates to the cost of consolidation - it might make a lot of sense and can open considerable cash flow to those who have limited income. If you’re worried about not being able to keep up with minimum repayments, consider reaching out to a debt counselor who can offer advice on budgeting and ways to repay.

Review what tax benefits you may be eligible for

Getting married (very obviously) changes things. The landmark Obergefell vs. Hodges Supreme Court decision in 2015 that established that the fundamental right to marry is guaranteed to same-sex couples, opened up many tax benefits to married LGBTQ+ people. From social security spousal benefits to joint income tax filing, tax advantages that non-LGBTQ+ people took for granted are now available to members of the LGBTQ+ community.

However, inequities still exist in the tax treatment of LGBTQ+ people, which are often complicated by the unique financial goals of many LGBTQ+ individuals. For example, starting a family often works differently than it does for most heterosexual families. As adoption, fostering and surrogacy are three of the main ways LGBTQ+ couples can start a family, building the necessary wealth to afford the often high costs of surrogacy will take time.


Buying a homeBuying a property is typically the biggest purchase most people will make in their lifetime. LGBTQ+ people are no different in this regard and homeowners usually have a great deal of their wealth stored in their homes. Your mortgage company can provide estimated costs for the loan interest, taxes, insurance, and fees — but don’t forget to include maintenance costs in your home ownership budget.Hire an advisor

With 86 percent of LGBTQ+ consumers saying they need support managing their wealth portfolio, finding the right financial advisor is vital for LGBTQ+ people who want to find the best plan for their future goals. Making use of the services of a financial advisor who is experienced in socially responsible investing can offer LGBTQ+ people access to investment portfolios that match their values of equality and non-discrimination.

Different parts of the LGBTQ+ community also deal with expensive milestones that can impact building wealth. For example, for trans people who self-fund their medical care, tens of thousands of dollars can go into the transition plan, making it even more difficult to create long-term wealth.

There is no silver bullet that addresses all of these challenges, but acknowledging the unique circumstances facing LGBTQ+ people when they work to build wealth is key. In practice, wealth managers may offer tailored investment plans that take into account the need to withdraw funds at certain intervals for major expenditures, such as surrogacy or gender-affirming medical surgery.

Retirement plans

Without traditional family support structures, many LGBTQ+ people face major challenges as they age. According to research from SAGE, 51% of LGBTQ+ elders are concerned they won’t have enough money to support themselves as they age, compared to just 36% of non-LGBTQ+ people.

Preparing for retirement doesn’t need to be a complex task, and the sooner you start putting money aside, your financial future becomes more secure. The higher the better, but saving around 10% to 15% of your income for retirement is a typical recommendation. If your employer matches retirement, make sure you’re contributing enough to gain the maximum benefit from that match.

Even if accessing a 401(k) isn’t possible, starting an individual retirement account (IRA) can be a great alternative to save money for retirement at the same time as benefiting from tax advantages.

For many people in their 20s, 30s, 40s and older, thinking about how to afford a comfortable retirement is often an intimidating task. But overcoming this unease is particularly important for the LGBTQ+ community as while just 42% of non-LGBTQ+ Americans have no money saved for retirement, this figure increases to 55% for LGBTQ+ people.

Estate planning

A comprehensive estate plan should include considerations for property transfer, health care, and legal protections. As many LGBTQ+ people may not be married or have children, it's especially important for those in the community to set up a clear plan that defines exactly where assets are to go after death. Further, if you are not married and don’t want members of your birth family to make major decisions around health or finances on your behalf, an estate plan would be able to give this responsibility to a person you trust.

A typical estate plan is made up of four separate components; a will, a revocable trust, an advance health care directive and a power of attorney. Each person will have their own circumstances, and different states have a range of separate estate and inheritance taxes. Speaking with a financial advisor can be a good way to navigate the best method of estate planning, especially to manage wealth and to ensure a straightforward estate.

Despite the unique challenges LGBTQ+ people contend with when it comes to finances, understanding the basics can make a genuine difference to improving your financial security and go a long way to ensure you miss out on common pitfalls that people often fall into.


This article is a sponsored editorial produced in collaboration with Comerica Bank. Between The Lines’s journalism is made possible with the support and partnership of advertisers like Comerica. Learn more about Comerica at


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