The FINANCIAL — A new survey from Wells Fargo & Company of Lesbian, Gay, Bisexual and Transgender (LGBT) Americans sheds light on how marriage laws are shaping the attitudes, behaviors, and conversations of LGBT couples related to money and planning for their future. The majority of LGBT Americans surveyed (86%) say that marriage-equality will improve the financial lives of same-sex couples, with 50% citing financial security and benefits as a top reason for wanting to get married ( love and commitment tops the list at 86%).
Marriage Changes How Couples Think About Finances
The survey included an oversample of LGBT Americans currently in same-sex marriages (living in states that recognized same-sex marriage before the federal ruling) to explore the impacts so far of legalized marriage. Seven in ten (70%) say they feel better off financially. Moreover, legalized marriage has changed how many think, feel, and talk about their lives:
Seventy-three percent say that same-sex marriage becoming legal has changed how they plan for their future.
Sixty-eight percent say that being married has changed how they think about their financial future, specifically.
Sixty percent say that being married has changed how they are planning for their financial future.
“The decision to marry seems to bring with it a level of financial security for same-sex couples,” said John Lake, Wells Fargo LGBT Segment Manager. “While LGBT Americans recognize that access to marriage provides certain financial benefits and obligations, there is still a significant knowledge gap around specific issues.”
The survey showed that 81% of LGBT Americans see getting married as a big financial decision, and almost nine in 10 (89%) say it’s important to evaluate the financial implications of getting married before doing so. However, just one in three (32%) say they fully understand the financial implications of doing so, and even fewer (29%) fully understand how Federal and state laws apply to same-sex marriages in their states. Likewise, most survey respondents do not fully understand all the legal implications of being married versus living together in several specific areas related to money and planning. For example:
Seventy-five percent do not fully understand how legal marriage affects access and rights to workplace pension benefits.
Seventy-two percent do not fully understand how legal marriage affects rights to inherit money from a spouse.
There remains a strong need for financial planning work and increased education. While almost half (48%) of LGBT Americans in same-sex marriages have a financial advisor (compared to 23% of U.S. married couples), less than one in five (18%) consulted with a financial or legal professional before getting married. Now that they are married, 56% say they have lot of financial planning work to do. Most LGBT Americans in same-sex marriages (54%) say that being married makes talking about money easier. Still, almost one in five (19%) have disagreements about money at least monthly, and 30% admit that discussions about finances have caused tension in their relationships.
Before Saying “I Do”
Among same-sex couples considering marriage, the need for advice is strong. Forty-seven percent feel unsure whether legal marriage would be financially beneficial for them or not, and 52% do not feel fully-prepared to make an informed financial decision about whether or not to marry. Only one in four (25%) have fully discussed with their partners whether marriage would be a good financial decision or a bad one.
The need for more conversations about money also resonated throughout the survey on a variety of issues LGBT Americans consider important to discuss before marriage. Fewer than one-third, for example, have fully discussed:
Whether to merge all of their accounts and assets (30%)
Their personal feelings and views about money (28%)
Personal debts and how marriage brings joint obligations (27%)
What they want to save or invest for (24%)
How much each partner can, will, and wants to earn (23%)
Their mutual risk tolerance with savings and investments (18%)
“Having conversations about financial issues like saving, investing, and preparing for retirement is critically important for same-sex couples. There are many unanswered questions out there, and as an industry we must keep working hard to provide useful information same-sex couples need in order to achieve their financial goals,” Lake added.