Wealth accumulation for the LGBTQ+ community
At a glance
Everyone needs a financial plan to help them reach their goals, but LGBTQ+ individuals may feel that financial advice isn't an inclusive space.
LGBTQ+ individuals may face specific hurdles in growing their finances.
We are working to better support the LGBTQ+ community.
Everyone needs a pot of money to support them in later life, and whether that comes from pensions, ISA savings or investments will depend on their own life circumstances.
Financial advisers can help people map out their journey and take steps towards reaching their goals, but it’s fair to say the finance industry doesn’t always ‘speak’ to the LGBTQ+ community.
This matters because, while everyone faces challenges in growing their wealth, LGBTQ+ individuals may experience additional barriers.
There’s a lot of work that needs to be done within the financial-services industry to improve how we work with LGBTQ+ individuals. It's important that we play our part to better the industry and build a more inclusive approach.
What are the challenges faced by the LGBTQ+ community?
These definitions and identities matter because we know it can be harder for some LGBTQ+ individuals to forge a path to financial wellbeing.
Some of the barriers to achieving this may be:
Stress from not being ‘out’ in the workplace, or having to modify their behaviour in the work week to fit in
A lack of support at work during key life events
Potentially higher costs when starting a family
Alienation from financial services, which make assumptions about gender, pronouns or sexuality
Lesbians and women in same-sex relationships may experience a double penalty from the gender pay gap…
Although other research suggests lesbians earn more than heterosexual women, perhaps due to lower rates of motherhood.
Costs involved in transitioning.
Additional housing costs from needing to live near LGBTQ+ communities in urban areas, which may lead to a reluctance to downsize in retirement to an area that may isolate them.
Lack of financial support from disapproving family.
Individuals from the LGBTQ+ community may experience any of these challenges during their lives, which can have a negative impact on building their wealth. This is not to say that it’s all bad or that these issues will affect everybody. Instead, we want to openly acknowledge the differences in life experiences of all parts of the community.Overcoming financial discrimination
Historically, LGBTQ+ people have been ‘shut out’ of financial services. For example, there was a time when insurers would ask applicants if they had ever taken an HIV test – something that men with same-sex partners would have been more likely to do.
Another example is how pension providers did not recognise same-sex partners. When a straight person died, their remaining pension went to support their opposite-sex partner, but couples in same-sex relationships did not have the same privilege.
Although many instances of discrimination that were woven into the practices of pension companies and insurers have been removed, their impact lingers in the misgivings that older LGBTQ+ individuals have about engaging with financial-services providers.
From our conversations with LGBTQ+ individuals, there appears to be a confidence gap when it comes to money and personal finances.
If you need help building a financial plan to reach your goals and build your confidence, contact us today - https://kathwilkinson.co.uk/contact
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Published: 13-Aug-2023: (7217)