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The Generational Wealth Gap in the LGBTQ+ Community


Enduring Financial Exclusion

It seems in every chapter of life, members of the LGBTQ+ community face financial challenges their straight peers would never imagine navigating. From adolescent years often marked by being kicked out of a childhood home, not receiving financial assistance for higher education from disapproving parents, being completely removed from the family estate plan – the toll for being LGBTQ+ can have massive financial implications. 

According to the Federal Reserve, the average inheritance is $76,200 for those coming from a household without a college degree and $92,700 for those from a college educated household. When viewed alongside Cerulli Associates forecasting that upwards of $68 trillion will migrate to younger generations within the next 25 years, LGBTQ+ heirs could stand to miss out on trillions through exclusion from their family’s estate plans.

Putting together the downpayment for a house or apartment can be a herculean task for just about anyone, but without the financial support of one’s family, many would not be able to fund a deposit.

What’s more, a disproportionately high number of young people experiencing homelessness identify as members of the LGBTQ+ community. The Williams Institute reports that between 20% and 45% of homeless youth identify as LGBTQ+. Without access to housing or financial support from family, LGBTQ+ youth can be at a financial disadvantage before even walking across the stage at high school graduation.

According to an Advocate survey, LGBTQ+ students also carry a larger student debt burden than their straight peers, with students identifying as a member of the queer community having on average $16,000 more in student loan debt. 

Intersectional Challenges Within the LGBTQ+ Community

While being LGBTQ+ can mean unique money issues, the financial challenges faced by queer people of color and queer women can often be compounded by other systemic inequities. 

Outside of the common financial barriers faced by members of the LGBTQ+ community, queer people of color also face a racial wealth gap. Employment discrimination, systematic inequalities, and disparities in financial education all play a role in creating this inequitable financial playing field.

The Federal Reserve notes that the average white family’s wealth is eight times greater than the wealth of an average black family. The gender pay gap also contributes to excluding women from building generational wealth. Data compiled by Pew Research indicates that women earned 84% of what men earned in 2020.

Supporting Future LGBTQ+ Generations

Despite the long-standing barriers facing LGBTQ+ people in gaining access to financial education and financial services, LGBTQ+ personal finance now offers a way for many to improve their financial literacy in more convenient ways than ever before. While investing early and regularly is one of the most effective ways to secure a financially comfortable retirement, it’s never too late to build wealth and support the next generation of LGBTQ+ people.

The LGBTQ+ community deserves access to quality financial advice specifically tailored to their unique needs. Financial planning is unique for every person, couple, and family, and there are several different planning possibilities for those in the LGBTQ+ community. It’s critical to find a financial advisor well-versed in the opportunities and challenges the community faces daily. 

Schedule a conversation with an Abacus financial advisor today to discuss building a plan for financial freedom that helps close the wealth gap facing the LGBTQ+ community.

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