As well as being optimistic about the political direction of the country following Obama’s election victory, the LGBT population in the US feels more comfortable financially and are more likely to feel better off than US adults generally, a survey finds.

As well as being optimistic about the political direction of the country following Obama’s election victory, the LGBT population in the US feels more comfortable financially and are more likely to feel better off than US adults generally, a survey finds.

In a
Wells Fargo survey covering 1,000 adults, two-thirds of LGBT investors said they feel confident about their financial future and are secure in their jobs. The corresponding figures for US adults are just 52 per cent and 55 per cent respectively.

What’s more, this segment of the population reports a higher median savings rate and is better prepared for retirement, with over half the non-retired LGBT respondents having a detailed retirement plan (compared to 42 per cent of adults). Around 42 per cent said they are working with a paid financial advisor on such plans while 22 per cent are using web-based tools.

“Lack of federal recognition of same-sex couples adds many layers of challenges to retirement and estate planning for all LGBT couples. Proper analysis and planning that comes with a financial advisor who understands the landscape of today’s differing state-by-state approaches is essential,” said Kyle Young, a financial advisor in the Short Hills, NJ, office of Wells Fargo Advisors.   

Highlighting the administrative burden of such complexities, a group of 278 businesses and organizations has filed an amicus brief with the Supreme Court, which is hearing arguments on two gay marriage laws, advising it of the cost and administrative complexity of the “conflicting legal regimes” under the Defence of Marriage Act.

Worries remain

Despite being more likely to have financial plans in place, LGBT adults still worry about finances, and particularly maintaining their lifestyles into retirement. After retirement, healthcare costs were the next largest concern. Unsurprisingly, LGBT couples with children were more likely to report financial concerns than those without.

This group of the population is, however, confident that when it comes to survivor rights and benefits change will come soon. Nearly half believe that within the next three years federal laws in this area will become the same for same-sex couples as they are for heterosexual couples, and a further 22 per cent believe this will happen over the next four or five years.

Wells Fargo cautioned that “tremendous confusion remains” about transfer rights and benefits. Some of the areas where there is a shortfall in understanding include the transferability of a number of assets and benefits such as Social Security, real estate, retirement savings and life insurance. Likewise, only 36 per cent of LGBT adults in the survey knew that federal taxes on survivor assets or benefits are different for the spouse/partner in a same-sex marriage than in a heterosexual marriage.