Planning for retirement involves more than just ensuring you have enough income to enjoy the rest of your life. It’s also about making sure you will be properly cared for and have a safe and welcoming living environment.
For the estimated 3 million LGBTQ+ people over 50, many of whom may have dealt with discrimination in its various guises over the course of their lifetimes, getting all of those conditions in place can be particularly difficult. With the older LGBTQ+ generation expected to more than double to 7 million by 2030, the challenges facing retirees will only grow.
- For older LGBTQ+ people who have experienced discrimination throughout their lives, retirement planning involves more than just getting their finances in order.
- LGBTQ+ retirees often face challenges, such as a lack of social and family support.
- The population of older LGBTQ+ people is expected to more than double to around 7 million by 2030.
The Impact of Discrimination
Before we go into details about the factors that LGBTQ+ people should consider when preparing for retirement, let’s explore some of the hurdles these communities have had to overcome.
The LGBTQ+ rights movement has made tremendous progress since the police raid on the Stonewall Inn sparked days of protests in 1969, as societal attitudes and legal protections continue to evolve. Progress on marriage equality and laws that protect LGBTQ+ people where they live and work has been accompanied by growing public support across a broad range of issues.
But such strides can’t erase the decades of discrimination the LGBTQ+ community has faced. The result is that many older LGBTQ+ people may feel isolated from society or lack the support of family members who would typically help with caregiving. In fact, about three-quarters of older LGBTQ+ people surveyed by an AARP study expressed concern about having family and social support systems they can rely on as they age. About a third worried about having to hide their identity to get access to senior housing, including more than half of transgender and other gender-expansive respondents.
A history of discrimination in areas as broad as education, employment, and housing has also had a cumulative impact on the financial well-being of many LGBTQ+ people. Poverty rates tend to be higher among members of the LGBTQ+ community, while income levels tend to be lower.
When it comes to saving for retirement, meanwhile, the LGBTQ+ community hasn’t kept pace with the overall population. Same-sex couples have put away about a quarter less toward retirement, on average, according to an analysis of Federal Reserve data by the AP-NORC Center for Public Affairs Research. LGBTQ+ respondents in a study by Prudential were less likely to have a retirement account such as a 401(k) or individual retirement account (IRA), as well.
How to Prepare Financially for Retirement
The good news is that it’s never too late to save for retirement. Moreover, the legal landscape has become significantly friendlier to the LGBTQ+ community in recent years, especially for same-sex couples. In 2015, the landmark Supreme Court ruling in Obergefell v. Hodges made same-sex marriage legal across the country. That ensured married same-sex couples could get access to all of the federal program benefits other married couples do, such as being able to leverage their spouse’s work history when claiming Social Security, as well as tax and estate planning advantages.
Many have taken advantage of marriage equality, with the number of married same-sex pairs more than doubling to more than half a million couples since the ruling. But for unmarried LGBTQ+ couples, benefits often won’t transfer to surviving partners without some legal and estate planning efforts. Unmarried partners don't receive Social Security spousal benefits. In addition, when they inherit an IRA or 401(k), they are given less favorable tax treatment than spouses receive.
Another key Supreme Court win for the LGBTQ+ community was Bostock v. Clayton County in 2020, which banned employment discrimination on the basis of sexual orientation and gender identity. In January 2021, President Joe Biden issued an executive order ensuring the protections cover other areas where sex discrimination is outlawed, such as housing, education, and healthcare. The Equality Act—passed by the House in February 2021 and awaiting Senate approval—would codify the Biden administration’s changes into law and further expand the protections to cover federally funded programs such as Meals on Wheels and other support programs aimed at older adults.
Yet despite the expanding rights, planning for retirement for older LGBTQ+ people can be challenging, especially for those who lack a family support network and instead rely on friends and others who make up “families of choice.” Here are some tips for preparing financially for retirement:
- Review important documents such as your will, life insurance policy, and 401(k) to make sure the beneficiaries are included.
- If married, consider ways to maximize newfound benefits, such as a spousal IRA.
- Seek professional advice to develop a plan that meets your unique retirement needs. SAGE, an organization that advocates for the older LGBTQ+ community, recently launched SAGECents, a digital platform that provides financial information and tools as a resource.
How to Find a Safe and Healthy Living Environment
Entering retirement should mean achieving a comfortable existence in which you have the care you need to live safely. However, finding a welcoming living situation can seem daunting for older LGBTQ+ people, especially if they’ve experienced discrimination in housing or healthcare situations in the past. Indeed, more than six in 10 respondents to the AARP survey expressed concern about neglect, abuse, or harassment in a long-term care environment.
The search for a new home environment can itself be fraught. An investigation by the Equal Rights Center found that nearly half of same-sex couples exploring senior housing in 10 states experienced unfavorable treatment in the form of less favorable housing options, costs, and financial incentives.
That’s why LGBTQ+ friendly communities are becoming increasingly popular. Nearly nine out of 10 respondents in the AARP survey said they would feel more comfortable in a long-term care facility if the staff had received training about their needs. To meet their needs, SAGE has been developing welcoming living communities that combine affordable housing with community centers. Meanwhile, the group has also joined with the Human Rights Campaign to create the Long-Term Care Equality Index, an assessment tool to help care facilities provide a welcoming environment for older LGBTQ+ people.
To make sure that a place you are considering is safe and friendly, here are some things to consider:
- Find out if the facility has anti-discrimination policies and training.
- Look for places that host LGBTQ+ community organizations or events.
- Make sure you designate someone you trust as a medical power of attorney, authorizing them to make medical decisions in case you’re incapacitated.
- Know your rights, including local laws. More than a third of states don’t have explicit laws banning discrimination on the basis of sexual orientation or gender identity.
- If you do experience discrimination, complain to facility staff or management. You can also file a complaint with the U.S. Department of Housing and Urban Development if you’re in federally supported housing, or with the state or local government.
- LGBTQ+ organizations can also help with everything from finding housing and care to advocating on your behalf. The Equality Federation has local advocacy groups in most states, while CenterLink lists LGBTQ+ community centers around the country. SAGE’s National Resource Center on LGBT Aging also tracks legal and financial resources in each state.
The Bottom Line
The LGBTQ+ community deserves full enjoyment of the healthy and happy retirement everyone should have. Unfortunately, despite progress in addressing various forms of discrimination, older LGBTQ+ people continue to face challenges even after they retire. The more that people are aware of the potential obstacles and come up with a plan to address them, the better chance they’ll have to enjoy their retirement years in comfort, companionship, and peace.