Deciding to start a family is as much a financial decision as 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. 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.
- Learning about your employer's family leave time policies and if any paid leave is available is helpful when planning for the arrival of a newborn.
- The Family Medical Leave Act allows a parent to take off 12 weeks of unpaid leave from their jobs.
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 nontraditional methods can be challenging and expensive.
Many LGBTQ+ couples and individuals who want to have a child have to adopt or find a surrogate. Both of these options can be costly, and there are sometimes legal barriers to overcome.
One of the most common ways to start a family nonbiologically is through adoption. Overall, adoption is the least expensive way to bring a child into a family, depending on the route that 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|
|Type of Adoption||Estimated Cost|
|Foster Care Adoption||$0–$2,600|
Source: Family Equality Council
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 who 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. Important considerations to make include:
- Who will be the surrogate?
- Will you use an agency or a matching service to find one?
- 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 most significant expenses that 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, counseling, and a monthly allowance for pregnancy-related expenses.
Intrauterine Insemination (IUI) Costs
If one or both of the partners is able to conceive children, then intrauterine insemination (IUI) may be a less costly option. Some families arrange to have extra vials of sperm frozen and stored to 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 — Known Donor||$25–$300 for optional testing|
|Sperm — Anonymous Donor||$300–$1,500 per vial|
|Sperm Storage Fees||$175–$750 per year|
|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|
Source: Family Equality Council
Adoption and surrogacy aren’t always easy for LGBTQ+ people. Only 28 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 nonbiological parent. If an LGBTQ+ couple seeks a stepparent or second-parent adoption, they can expect to pay $250 to $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 (USDA) 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 that 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 and Medical Leave Act (FMLA) for 12 weeks of unpaid leave.
FMLA leave is unpaid time away from your job but some employers offer paid leave as well depending on the company.
Explore LGBTQ+ Family-Building Grants
Some organizations 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 the Baby Quest Foundation, which provides grants to individuals and couples who can’t afford in vitro fertilization, sperm and egg donation, egg freezing, and surrogacy costs.
There is also a federal tax credit for up to $15,950 in qualified adoption expenses per child in 2023, up from the $14,890 in 2022. The credit is nonrefundable, 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 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
Given the unique circumstances of LGBTQ+ family planning, it may be best to consult a professional who is familiar in family law.
Debt, Savings, and Fun
Monthly debt obligations also should 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 that 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 that you’ll likely spend more money on birthday celebrations and holidays. Be sure you have enough set aside so that your family can enjoy these moments. You can link your bank account to a budgeting app or software to help you stay on track. Or, if you prefer, keeping track of your budget in a good old-fashioned spreadsheet works, too.
Review Insurance and Estate-Planning Documents
Now that you are responsible for another human being, it’s essential to ensure that 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 if something happens to both parents. You can create a will by using a free service online or hiring a financial planner specializing in estate planning.
Can LGBTQ+ Couples Legally Adopt a Child?
Yes, same-sex couples can adopt. Ruling by the Supreme Court has allowed that same-sex couples can adopt in all 50 states.
Can LGBTQ+ Couples Adopt From all Countries?
No, not all countries have the social standards and legislation that the United States does in allowing same-sex couples from adopting a child. Full joint adoption by LGBTQ+ couples is not legal in all countries.
Why Is Adoption So Expensive?
Adoption is expensive because of the wide assortment of professionals involved in ensuring the process is performed legally. This includes the time of lawyers, social workers, doctors, government administrators, counselors, and more.
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.”
Family Equality Council. “Building LGBTQ+ Families: The Price of Parenthood.”
U.S. Department of Labor. “Family and Medical Leave Act.”
American Surrogacy. “Intended Parents: How Much Does Surrogacy Cost?”
Movement Advancement Project. “Equality Maps: Foster and Adoption Laws.”
Michigan Legislature. “Surrogate Parenting Act.”
U.S. Department of Agriculture. “The Cost of Raising a Child.”
Society for Human Resource Management. “New SHRM Research Shows Employers Offering Paid Leave Has Increased.”
HelpUsAdopt.org. “Frequently Asked Questions.”
Baby Quest Foundation. “What We Do.”
Internal Revenue Service. "IRS Provides Tax Inflation Adjustments for Tax Year 2023."
Internal Revenue Service. “Topic No. 607 Adoption Credit and Adoption Assistance Programs.”
Guide to Finance for LGBTQ+ People
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Mortgage Lending for LGBTQ+ People
Banks that Support the LGBTQ+ Community
Citi Launches New Program for Transgender and Non-binary Cardholders
Paying for College as an LGBTQ+ Student
LGBTQ+ Representation in the Workforce
LGBTQ+ Pay Gap and Unemployment
Healthcare and Health Insurance for LGBTQ+ People
How Being Nonbinary Affects Getting Life Insurance
Qualifying for Life Insurance When You're Transgender
Paying for Transgender Surgeries
Preparing for Retirement as an LGBTQ+ Person
Slow Path to Social Security Benefit Equality for Same-Sex Couples
Finding LGBTQ+ Friendly Retirement Options