One of my favorite definitions of the work we do comes from Elizabeth Jetton, M.Ed, CFP®, who said that financial planning is about reconciling the inherent tension between what we need and want today and what we’ll need and want in the future. Financial planning is self-care for both our current selves and our future selves. It’s a way of ensuring we can live our lives to the fullest now, while also being able to enjoy the benefits of our hard work in the future.

When financial planning for our future selves, we think about things such as: At what age do we want to have the flexibility to not have to work? How do we want to care for ourselves and our loved ones when our health starts to deteriorate? What do we want to happen when we become incapacitated or die? 

Many LGBTQ+ people don’t follow traditional life paths or have the same support systems as their straight counterparts; and as a result, traditional financial planning strategies don’t always apply. 

Here are some ways financial planning for the long run for LGBTQ+ folks can be unique, and how we think about them as an LGBTQ+ specialized firm.  

Read More: How Being LGBTQ+ Shapes Your Finances

LGBTQ+ Planning for the Long Run: Lifestyle Change and Retirement Planning

It’s so fortunate that the LGBTQ+ community here in the United States currently has the options to do things like get married and start a family. But for our LGBTQ+ clients who are about to enter or have already begun their retirement phase of life, this was not always the case. They earned, spent and saved money under entirely different assumptions about their future, and often in environments of discrimination. Even younger LGBTQ+ folks today can’t look at our futures through the same lenses as our straight counterparts. Our future life paths and the life experiences that shaped us are just not the same.

To give an example of how this can look in practice, a queer married couple about to enter retirement might be keeping their money separate. They pay the bills from their own separate checking accounts, and they save into their own personal savings. They come from a background of not imagining that they could ever combine their finances under the legal protections of marriage. But keeping money separate presents some challenges to getting a clear picture of their joint success in retirement because they’re living in financial silos. This same couple might have different levels of savings and wish to retire together on the same timeline. Thus, one of them may have to save into their investments much more aggressively in the final years of full-time work. They might also have to consider getting a small, part-time job to help offset the need to withdraw investments so that their portfolio will last as long as their partner’s. Add in the fact that they might not have kids to support them as they age, and we’ll need to talk about whether to carve out a portion of the portfolio for potential long-term care (health) costs.

LGBTQ+ Planning for the Long Run: Healthcare

It’s not uncommon for LGBTQ+ households to plan for a future without kids. This raises an important consideration, which is planning for potential long-term care and medical costs. Depending on whether it’s an individual or a couple, a planning conversation about long-term care starts with the more qualitative questions: Where do you want to be if you’re unable to care for yourself? For a couple, to what extent would you want to care for each other? Does it make sense to purchase some form of insurance, or to self-insure? Sometimes it’s simple. A married gay couple with no children or close family to step in and support them might decide to purchase long-term care insurance. Paying the annual premiums is worth the peace of mind for them. For other households, pre-existing health issues make it hard to qualify for insurance, so “earmarking” a portion of the retirement portfolio for potential long-term care and out-of-pocket medical bills is the best option.

Planning for potential long-term care and medical costs may also need to include finding providers who are sensitive to and knowledgeable about the unique healthcare needs and concerns of LGBTQ+ individuals. For example, we’ve found that being on PrEP has been an issue for some clients in qualifying for life insurance, which can come as a surprise. One way we stay on top of this is by working closely with an insurance broker who understands that clients we send to them are LGBTQ+, so that they can provide a safe and supportive space for them as they disclose sensitive medical information. 

LGBTQ+ Planning for the Long Run: Estate Planning and Legal Protections

We’re still in fresh territory for same-sex couples being afforded the same legal protections and benefits of marriage as opposite-sex couples. This means that it’s even more important for LGBTQ+ households to make sure they have all the necessary legal documents in place, such as legal adoption papers for same-sex parents, power of attorney documents, healthcare proxies, and wills, to ensure that their wishes are legally recognized and protected. Additionally, for transgender and non-binary individuals, legal considerations around changing their name, gender marker, and other personal identifying information may need to be factored into estate planning. 

We continually work with same-sex couples who have built lives together, including shared homes, combined bank accounts, and investment accounts, without ever officially getting married. In these cases the estate planning process is crucial. It includes making sure that all financial accounts are properly titled so that if something happens to one or both of them, their assets will pass to the proper individual(s). Designating co-owners and beneficiaries on financial accounts supersedes any existing wills, and, if no wills exist, state probate law (which is the default process of assigning assets in the case of a deceased person with no will). This part of the planning is a low-hanging fruit, and critical for non-married households. To ensure a well-rounded estate plan, we refer most of our clients to estate planning attorneys when they’re ready to finalize key legal documents and make sure wills are aligned to reflect all the necessary instructions to make sure their wishes are carried out and loved ones are cared for. 

Read More: Estate Planning for LGBTQ+ Couples

As financial planners, we think about the long run all the time. And as part of the LGBTQ+ community, we are constantly thinking about how our futures might be different from those of straight folks. At its core, LGBTQ+ financial planning for the long run requires openness and sensitivity to the nontraditional. We enjoy the creativity and beauty of the lives that our LGBTQ+ clients design for themselves in our financial planning conversations.