LGBQT+ Families & Finance
Having children is no easy feat. With the cost of child rearing and education growing every year, parents are finding it difficult to catchup. However, since 2000 the average number of children Americans are having grew from 1.87 to 1.93 (Statista).
In 2015, the federal government had estimated the average cost of raising a child through the age of 17 is $233,610 (not including the cost of college, USDA). However, with the incredible rise of inflation due to the pandemic and the Fed’s systematic printing of dollars and government spending, inflation has risen over 16% in the last seven years. Therefore, raising a child in today’s dollars is about $40k more than it was 7 years prior ($272,613).
The breakdown includes the basics:
What the government forgot to include was the cost of having a child. Even for heterosexual partners, who can mostly conceive for relatively low cost, the cost of birth ranges from $5-14.5K. However, building a family as a LGBTQ+ couple looks a little different, and significantly more expensive.
Today, financial advisors and planners don’t seem very comfortable with conversing with ‘a-typical’ couples on their unique needs nor do they know the requirements and demographics which make our LGBTQ+ friends disproportionally disadvantaged.
Can you imagine a Connecticut 35 year old man who spends his weekends playing golf at his father’s country club talking to a lesbian or bi couple on how to save up for a surrogate?
His boat shoes wouldn’t know where to start!
There are significant findings that LGBTQ+ millennials have disproportionately high rates of poverty, lack of financial security and poor health outcomes. Transgender and cisgender bisexual women have the worst outcomes (UCLA School of Law). Additionally, the estimated median earnings in LGBTQ+ households are ~8% lower to their heteroxual counterparts (Morningstar).
On top of that, the cost of parenthood is incredibly higher compared to a couple that can conceive without medical or third party intervention.
Foster-to-Adopt: $0–$2,600
Domestic Adoption: $20k – $45k
International Adoption: $25k – $70k
Anonymous donor sperm: $300 – $1,500 / vial
Known Donor Sperm: $25 – $300
In Vitro Fertilization (IVF): $13.5k – $21k+
Reciprocal In Vitro Fertilization (R-IVF): $15k – $23k
Intrauterine Insemination (IUI): $250 – $4k
Gestational Surrogacy $60k – $150k+
Egg or sperm freezing: $250 – $1,500 (sperm), $7k – $12k (egg) + $175 – $750 / year
Establishing Legal Parentage: $100 – $3,000
Starting from an earlier age, LGBTQ+ millennials (and even Gen Z) need to be acutely aware of their financial requirements if they choose to have children. Whether its egg freezing before a transgender transition, or international adoption, there is a host of considerations that a majority of financial advisors have no idea how to incorporate into a financial plan.
The best way to achieve the life you want, is to plan ahead. Research the costs in your area, speak with your partner early on how you would like to become parents and save early.
The complexity of the different paths to parenthood, along with the social determinants of financial and physical health for LGBTQ+ individuals and families doesn’t have to prevent anyone from reaching their goals. Building a family can be possible with long term planning and goal setting!
See a link for grants for LGBTQ+ families
