This article was published on January 8th, 2019
Love, relationships, and marriage are ideas and concepts many queer people thought they could only ever dream of growing up. Since the United States Supreme Court Windsor vs. the United States decision and then later the Obergefell vs. Hodges decision deeming same sex marriages legal and recognized nationwide, same-sex couples are getting married. However, queer couples still face an uphill battle when it comes to marriage and their changing financial landscape. Here are some of the personal finance issues that married same-sex couples should be aware of:
Gay people are already at a disadvantage when it comes to finances in same sex marriage. Recent research has shown that LGBT people make $50,000 less than their heterosexual co-workers, and are often disproportionately limited to things like maternity leaves and dual benefits on retirement accounts. When paired next to their non-queer co-workers, LGBT employees and couples’ eligibility for social security and other pensions upon retirement can end up with hundreds of thousands of dollars less upon retirement for a same sex marriage.
If you are filing a tax return with your wedded partner, they might not receive access to the same benefits and rights that heterosexual couples receive, with tax rules varying from state to state. This is especially a factor if you are only legally in a domestic partnership or civil union. States and even the federal government are not required to consider either in the same way as marriage in some circumstances.
Consider sustaining financial independence while retaining joint and separate accounts. With issues like income disparity, same sex couples might find that sustaining a level of financial independence is best. Keep a joint bank account for bills and expenses you amass together, but retain an independent account for your personal expenditures. You’ll feel a level of independence while still building a life collectively with your partner.
If you have non-employer-sponsored retirement accounts these might not necessarily automatically entitle your spouse benefits and ownership upon death. Make sure your accounts indicate clearly that your partner is the beneficiary of your account or add your partner’s name to your retirement account as a co-owner.
If you are going to expand your family or have dependents, hiring a tax advisor maybe the best advice given to a married same sex couple. A financial expert is going to know what your best avenues for saving are while providing enough financial security for you and your family. An expanding family doesn’t necessarily have to mean expanding you and your partner’s debt.
Plan for the future now. Start saving. You and your partner need to make smart decisions with your money so dealing with expenses that come up later on down the road don’t become a hindrance in your relationship. Try and make smart, educated, and solid investments towards your goals and collective future together. The more you start educating yourself now about finances, marketplaces, investments, retirement accounts, and saving for your future, the better prepared you’ll be for life’s little (and sometimes huge) roadblocks.