Deciding to start a family is as much of a financial decision as it is an emotional one. This is especially true for lesbian, gay, bisexual, transgender, and queer (LGBTQ+) people, who often rely on alternative paths, such as adoption and surrogacy, to have children.
But despite the challenges, parenthood is on the rise in the LGBTQ+ community. According to a survey from the Family Equality Council, 77% of LGBTQ+ Millennials are already parents or are considering having children.
Family planning can be a complex and costly process for LGBTQ+ people. Understanding your options is important so that you will be financially prepared for the future ahead.
- Despite high costs and other obstacles, the number of LGBTQ+ parents and prospective parents is on the rise.
- Costs of adoption, surrogacy, and legal fees can sometimes add up to well over $100,000.
- LGBTQ+ families can prepare for the financial impact of starting a family by understanding the costs and sticking to a budget.
The Price of LGBTQ+ Parenthood
In recent years, increasing public acceptance and advancements in reproductive technology have opened doors for LGBTQ+ people who want to become parents. However, starting a family through non-traditional methods can be both challenging and expensive.
Many LGBTQ+ couples and individuals who want to have a child have to adopt or find a surrogate. Both these options can be costly, and there are sometimes legal barriers to overcome.
One of the most common ways to start a family non-biologically is through adoption. Overall, adoption is the least expensive way to bring a child into a family, depending on the route you take. For example, it may not cost anything to adopt a foster child, but you could spend up to $70,000 if you adopt a child from a foreign country.
|Potential Costs of Adoption|
|Foster Care Adoption||$0-$2,600|
|Domestic Adoption||$20,000 - $45,000|
|International Adoption||$25,000 - $70,000|
Source: Family Equality
Having a child through surrogacy is another option for LGBTQ+ people who want to start a family. There are two types of surrogacy arrangements—traditional surrogacy and gestational surrogacy. Traditional surrogacy is when the birth mother carries a child she has conceived from donor sperm; gestational surrogacy is when a third person gives birth to a baby conceived outside the womb from donor egg and sperm through in vitro fertilization. Both options provide ways for an LGBTQ+ person to have biological children.
Surrogacy is generally more expensive than adoption, and there are many factors to consider when determining the overall cost. For example, who will be the surrogate? Will you use an agency or matching service to find one? Or is the surrogate a close friend or family member?
Gestational surrogacy is typically the most expensive option, but one in which the surrogate has no genetic connection to the baby. One of the biggest expenses potential parents face during this process is surrogate compensation. In addition to paying a surrogate a base compensation, other additional costs may include:
- Legal fees
- Medical expenses
- Travel expenses
- Monthly allowance for pregnancy-related expense
Intrauterine insemination (IUI) costs
If one or both of the partners is able to conceive children, intrauterine insemination (IUI) may be a less costly option. Some families arrange to have extra vials of sperm frozen and stored so that they can have more than one child from the same donor, making their children born from the same mother full siblings.
|Potential Costs of Surrogacy/Insemination|
|Sperm – Anonymous Donor||$25 - $300 for optional testing|
|Sperm – Anonymous Donor||$300 - $1,500 per vial|
|Sperm Freezing||$250 - $1,500|
|Sperm Storage Fees||$175 - $750 per year|
|Egg Freezing||$7,000 - $12,000|
|Egg Storage Fees||$350 - $700 per year|
|Intrauterine Insemination (IUI)||$250 - $4,000|
|In Vitro Fertilization (IVF)||$13,500 - $21,000+|
|Reciprocal In Vitro Fertilization (R-IVF)||$15,000 - $23,000|
|Gestational Surrogacy||$60,000 - $150,000+|
Source: Family Equality
Adoption and surrogacy aren't always easy for LGBTQ+ people. Only 25 states have laws in place that prohibit discrimination against prospective adoptive parents based on their sexual orientation or gender identity. In 11 states, state-licensed child welfare agencies can legally refuse to place children with same sex-couples and LGBTQ+ individuals if they say it is against their religious beliefs.
Like adoption, states have their own laws when it comes to surrogacy. In some states, surrogacy is not permitted and surrogacy contracts are not legally valid. In Michigan, surrogacy contracts for compensation are illegal and subject to criminal penalties.
Becoming a legal parent can be another obstacle. A birth certificate alone is sometimes not substantial proof of parentage in court dealings or medical emergencies. Legal fees to establish parentage range from $100 to $3,000. This includes situations in which the donor's parental rights are terminated, or rights are secured for a non-biological parent. If an LGBTQ+ couple is seeking a step- or second-parent adoption, they can expect to pay between $250 and $3,000.
How to Prepare Financially
Whether you are adopting a child or using a surrogate or IUI, the cost of bringing a child into your home is only the beginning of your family’s financial journey. The U.S. Department of Agriculture reported that the cost of raising a child born in 2015 is approximately $233,610 for middle-income married couples.
This figure includes basic costs a middle-income family would incur from the child’s birth through age 18, such as food, shelter, transportation, healthcare, clothing, childcare, and education (not including college).
This might seem overwhelming to prospective parents, particularly those who also have to plan for costs such as adoption or fertility treatments. Having a plan in place will give you peace of mind and help you ensure financial security for the future.
Here are some budgeting tips that can help LGBTQ+ families start off on the right financial foot.
Plan for family leave time
It’s important to understand which benefits your employer offers for new parents, such as pay, length of time off, benefits for fathers compared to mothers, etc. According to a 2020 report from the Society for Human Resource Management, 55% percent of U.S. employers offer paid maternity leave, and 45% offer paid paternity leave.
Your company may not offer paid time off, but you may qualify for benefits under the Family Medical Leave Act (FMLA). FMLA allows mothers to take 12 weeks of unpaid leave.
Explore LGBTQ+ family building grants
There are organizations that will provide financial assistance to LGBTQ+ families who want to start a family. For example, HelpUsAdopt.org offers adoption grants up to $15,000 for couples and individuals looking to adopt a child. It is free to apply for grants, and the program supports all types of families.
LGBTQ+ families can also receive financial assistance for reproductive technology. One example is Baby Quest Foundation, which provides grants to individuals and couples who can’t afford costs of in vitro fertilization, sperm and egg donation, egg freezing, and surrogacy costs.
There is also a federal tax credit for up to $14,300 in qualified adoption expenses per child (in 2020). The credit is non-refundable, but you can carry over any remaining credits to future tax years for up to five years.
Create and stick to a budget
Whether you are adjusting your budget for your growing family or you are starting from scratch, the most important thing is to make sure the budget works for you. Start by adding up your monthly household net income. Next, list all of your fixed and variable monthly expenses, including things like:
- Mortgage or rent
- Car payment
- Wireless bill
- Streaming services
Monthly debt obligations should also be included with your expenses. For example, if you used a loan or credit card to pay for fertility treatments, you'll want to make sure you allocate enough for the payment.
Next, determine your savings goals. This should include long-term savings, such as a retirement fund, and three to six months worth of expenses saved in an emergency fund. You may also want to consider a college savings plan, such as a 529 plan, for your child(ren). Calculate the amount you need to save each month to meet your goals and include this amount in your budget.
Don't forget about "fun money". Having children means you'll likely spend more money on birthday celebrations and holidays. Be sure have enough set aside so that your family is able to enjoy these moments.
Review insurance and estate-planning documents
Now that you are responsible for another human being, it's important to make sure you have adequate health and life insurance for your family. Term life insurance, which pays out a death benefit if the beneficiary dies during a stated term, is usually a good option for parents.
Parents should also have a last will and testament that specifies who would get custody of their children in the event something happens to both parents. You can create a will using a free service online, or hire a financial planner who specializes in estate planning. Given the unique circumstances of LGBTQ+ family planning, it may be best to consult a professional.
The Bottom Line
Today, LGBTQ+ families and individuals have significantly more options when it comes to starting a family than earlier generations did. However, these options can come with a hefty price tag. It's important not to take these steps without thinking through the financial aspects and planning in advance.
Family Equality Council. “LGBTQ Family Building Survey”. Accessed May 5, 2021.
Family Equality. “Building LGBTQ+ Families: The Price of Parenthood”. Accessed May 5, 2021.
Academy of Adoption & Assisted Reproductive Attorneys, Guide Advocate Project. “Traditional Surrogacy.” Accessed May 5, 2021.
American Surrogacy “Intended Parents. How Much Does Surrogacy Cost?” Accessed May 5, 2021.
American Pregnancy Association. "Intrauterine Insemination (IUI)," Accessed May 6, 2021.
Movement Advancement Project. "Equality Maps: Foster and Adoption Laws." Accessed May 5, 2021.
All Things Surrogacy.org. "Surrogacy Laws by State." Accessed May 5, 2021.
U.S. Department of Agriculture. “The Cost of Raising a Child.” Accessed May 5, 2021.
Society for Human Resource Management. “New SHRM Research Shows Employers Offering Paid Leave Has Increased.” Accessed May 5, 2021.
U.S. Department of Lavor. “Family and Medical Leave Act.” Accessed May 5, 2021.
HelpUsAdopt.org. “Frequently Asked Questions.” Accessed May 5, 2021.
Baby Quest Foundation. “What We Do.” Accessed May 5, 2021.
Internal Revenue Service. "Topic No. 607 Adoption Credit and Adoption Assistance Programs." Accessed May 5, 2021.