The State of LGBTQ Finance: A Survey of 2,000 Americans

At least 7% of American adults -- some 20 million people -- identify as LGBTQ+, according to Gallup, and they make up an important part of the country’s social and economic fabric.

Yet data on the financial state of LGBTQ+ Americans is lacking. The absence of data makes it more difficult for financial advisors and service providers to serve a group that is larger than the population of New York and has an estimated purchasing power of $1.4 trillion.

For the second year in a row, The Motley Fool and the Debt Free Guys teamed up to gain a better understanding of LGBTQ+ finances. Through the LGBTQ+ Money Study, a landmark survey of 2,000 LGBTQ+ Americans in its second year -- including 700 transgender Americans -- we found that many LGBTQ+ Americans continue to face challenges to achieving long-term financial health and generational wealth.

Discrimination toward the community is on the rise, particularly among those who identify as transgender, according to the most recent data from The Motley Fool. The level and frequency of financial stress throughout the LGBTQ+ community has also grown over the past year.

These outcomes are a reflection of growing systemic discrimination against LGBTQ+ Americans. Despite efforts at the federal level to protect them, at the state level more than 520 pieces of legislation aimed at reducing the rights of LGBTQ+ Americans were introduced in 2023 alone.

Read on to learn more about the state of LGBTQ+ finance in the United States.

Key findings

Key findings

• Financial discrimination: More than half (55%) of LGBTQ+ Americans have experienced discrimination by someone in financial services in 2023 (up 7% from 2022), and 49% of that group attributes the discrimination to some lack of financial insecurity in 2023 (up 5% from 2022). That number is even higher among transgender Americans, 74% of whom report having been discriminated against by someone in the finance industry.
• Financial stress: Seventy-two percent (72%) of LGBTQ+ Americans surveyed have a high amount of financial stress (up 3% from 2022). One-third of LGBTQ+ Americans stress about their finances daily, and just over half (55%) stress at least once a week.
• Financial tools: LGBTQ+ Americans are less likely to use important financial tools than the overall U.S. population, such as a retirement account (36% to 51%), non-retirement investment account (13% to 56%), and life insurance (42% to 56%).

LGBTQ+ Americans are less likely to have important financial tools than the average American

A smaller percentage of LGBTQ+ Americans have key financial products, such as a retirement account, brokerage, and insurance, than the overall U.S. population.

• Investment products: LGBTQ Americans are significantly less likely than the overall U.S. population to have investment products, including a retirement account (36% to 51%), a government pension (13% to 21%), and a non-retirement investment account (13% to 56%).
• Insurance products: LGBTQ Americans are nearly as likely as the overall population to have health insurance (88% to 91%) but are somewhat less likely to have life insurance (42% to 54%) and significantly less likely to have disability or critical illness insurance (16% to 49%).
• Mortgages: LGBTQ Americans are less likely than the overall population to have a mortgage (27% to 40%). The largest gap is between lesbian, gay, and bisexual Americans and the overall population (21% to 40%).
• Crypto: LGBTQ Americans are more likely than the general population to have a cryptocurrency wallet (27% to 16%). Still, 5% fewer LGBTQ Americans report having a crypto wallet compared to 2022.
• Estate planning: LGBTQ Americans are less likely than the general population to have a will or estate plan (10% to 33%).

Many of these products form the foundation of financial well-being. They provide ways to grow wealth, prepare for retirement, and build a financial safety net.

“When folks think of personal finance resources, they often think of behemoth financial service firms and an erratic stock exchange floor in New York City, and they find it hard to identify with those images,” said John Auten-Schneider, co-author of the Debt Free Guys and co-host of the Queer Money Podcast alongside his husband, David. “For folks who think of money and financial independence as too stale, male and pale, we’d encourage them to look elsewhere. It’s exciting to us that there are now personal finance educators through the LGBTQ+ spectrum helping people start micro-businesses, pay off debt, invest in socially responsible investments in the stock market and everything money-related in between all that.”

A 2023 survey from the Center for LGBTQ Economic Advancement & Research and Movement Advancement Project, The LGBTQI+ Economic and Financial (LEAF) Survey, found that 23% of LGBTQI+ Americans lack a checking or savings account.

Priorities and Concerns

72% of LGBTQ+ Americans have a high amount of financial stress

Seventy-two percent of LGBTQ+ Americans carry a high amount of financial stress, up 3% compared to 2022.

Genderqueer/non-binary Americans carry the least amount of financial stress, although 61% still have a high level every day. Lesbian, gay, and bisexual Americans carry the most financial stress.

A third of LGBTQ Americans stress about their finances daily. Just over half (55%) stress at least once a week, and just 15% stress about money less than once a month.

The LGBTQI+ Economic and Financial (LEAF) Survey, found that LGBTQI+ Americans are more likely to report negative emotions about their finances than non-LGBTQI+ respondents.

The survey found:

• Anxiety was the most common emotion 46% LGBTQI+ respondents felt about their finances compared to 23% of non-LGBTQI+ respondents.
• 41% of LGBTQI+ respondents reported feeling overwhelmed about their finances compared to 22% of non-LGBTQI+ respondents.
• 32% of LGBTQI+ respondents reported feeling depressed about their finances compared to 16% of non-LGBTQI+ respondents.

Financial stress can take a mental toll, so it's best to address it if possible. To do so, it's necessary to understand the drivers of financial stress.

Emergency savings and cost of living are top financial priorities and concerns for LGBTQ+ Americans

An unplanned financial emergency is the most common financial worry among LGBTQ+ Americans, with 68% putting it in their top three financial concerns.

Sixty-three percent said keeping up with the cost of living is a top concern.

Paying for a child’s education is the lowest-cited primary worry among LGBTQ+ Americans (16%), followed by being able to afford a home (30%), and making the right investment decisions (32%).

The top financial worries of LGBTQ+ Americans align with their top financial priorities.

Keeping up with the cost of living is the most common top priority for LGBTQ Americans (65%), followed by building emergency savings (58%).

Saving or paying for a child’s education (25%) and investing outside of retirement (26%) are the lowest priorities.

Getting out of debt (43%), saving for retirement (46%), and saving for buying a home (37%) are middling financial priorities.

These findings echo those from the 2023 LGBTQI+ Economic and Financial (LEAF) Survey, which found the top priorities of LGBTQI+ people to be paying bills on time, reducing debt, improving their credit score, saving for gender-affirming care and services, and building an emergency fund.

The top financial worries and goals in among LGBTQ+ respondents align with challenges faced by LGBTQ+ Americans highlighted in other studies:

• Gender nonconforming men and women and those in sexual minorities are more likely to be in poverty, have debt, be behind on bills, and face eviction, per a 2023 national longitudinal study published in the Journal Epidemiol Community Health found that
• 34% of transgender Americans are experiencing poverty, 30% had experienced homelessness, and 11% who had held a job said they had lost it because of their gender identity or expression, according to the 2022 U.S. Transgender Survey found that
• LGBTQ+ workers earn 90 cents on the dollar compared to the typical worker in America. LGBTQ+ people of color, transgender folks, and non-binary Americans earn less, according to an analysis from the Human Rights Campaign.

55% of LGBTQ+ Americans have experienced discrimination by someone in financial services

Fifty-five percent of LGBTQ+ Americans say they have been subject to discrimination by someone in the financial services, banking, or investing industry.

That number is higher among transgender Americans, 74% of whom report having been discriminated against by someone in the industry.

Overall, the percentage of those who report discrimination is up 7% from 2022, and the percentage who say it has led to some sort of financial insecurity is up 5%.

Discrimination felt by transgender Americans from the financial services industry is up 11% from last year, and, for lesbian, gay, and bisexual Americans, it is up 13%.

Financial discrimination not only causes emotional harm, but it can cause financial damage or deny people financial opportunities that would otherwise be available.

"Having spent our careers in financial services, both within and outside of corporate, it’s particularly distressing to see that the percentage of LGBTQ+ respondents who feel they’ve been discriminated against by someone in our industry has increased [since last year],” said Auten-Schneider. “Most Americans believe that there’s a lack of personal financial education, but most Americans outside of the LGBTQ+ community can comfortably turn to a financial advisor or planner to help them with what they don’t know or aren’t comfortable doing on their own.”

Among those in the LGBTQ+ community who have faced discrimination in the financial services industry, 49% say that it has contributed to some type of financial insecurity.

Transgender Americans are not only more likely to experience discrimination in the financial services industry but be harmed from it.

Among transgender Americans who have faced discrimination, 67% say it has led to financial insecurity compared to 42% of lesbian, gay, and bisexual respondents and 37% of genderqueer/non-binary respondents.

These statistics show the importance of diversity in the financial services industry and building safe spaces for LGBTQ+ Americans throughout the industry.

Local affiliates of the National LGBT Chamber of Commerce are a good place to start looking for an LGBTQ+ financial advisor or an ally of the community.

Less than half of LGBTQ+ Americans feel ready to make most major financial decisions

Less than 50% of LGBTQ+ Americans feel prepared to make most major financial decisions.

For example:

• 46% think they are prepared to build and maintain emergency savings.
• 39% are confident about doing their own taxes.
• 36% say they’re prepared to make decisions about retirement planning.
• 23% say they feel prepared to make decisions about buying a home.
• 21% -- the lowest percentage -- say they feel prepared about making investment decisions.

The only area in which more than 50% of LGBTQ+ Americans feel prepared to make financial decisions is in paying off credit card debt (51%).

The data suggests that financial education for LGBTQ+ Americans may be lacking or that LGBTQ+ Americans don't feel as though financial education resources are made for them. Americans who are part of underrepresented groups often lack financial role models who can mentor them through financial challenges and milestones.

33% of LGTBQ+ Americans don’t have access to a company-sponsored retirement plan

One-third of LGBTQ+ Americans don’t have access to a company-sponsored retirement plan, such as a 401(k), while 8% have access to one but opt not to contribute.

Transgender Americans are less likely to have access to a company-sponsored retirement plan than other LGBTQ Americans, but they’re most likely to contribute 4% or more if they do have access.

Among those who have access to a company-sponsored retirement plan and do contribute, about a fifth put 9% or more of their pay into the account.

As a rule of thumb, it's recommended that you contribute to your 401(k) at least as much as your employer will match. Not doing so leaves free money from your employer on the table.

Only 36% of LGBTQ+ Americans think they’re on track to retire by the age they’d like to

Thirty-six percent of LGBTQ+ Americans believe they’re on track to retire at the age they would like to. Thirty-four percent don’t think they’re on track to retire when they’d like to and 30% aren’t sure.

Transgender Americans are most likely among LGBTQ Americans to feel like they’re on track for retirement but still less than the majority are confident they’ll retire at the age they’d like to.

Views on retirement progress haven’t changed much since 2022; just 3% more feel on track for retirement compared to 2022.

Barriers

LGBTQ investing barriers: Not knowing how to invest or what to invest in

LGBTQ+ Americans are much less likely to have a non-retirement investment account than the overall population. So what are the barriers to LGBTQ+ investing?

There are a variety of factors:

• 21% of LGBTQ+ Americans said they don’t invest because they don’t know how to.
• 20% said they don’t know what to invest in.
• 15% said investing is too risky or intimidating for them.
• 9% said they feel as though investing tools aren’t made for them.

Slightly fewer respondents are confident in knowing how to invest (-5%) and what to invest in (-3%) compared to 2022. An additional 3% think investing tools aren’t made for them.

Those are all valid concerns that can be allayed. But they suggest that LGBTQ+ Americans, like other underrepresented groups, may feel excluded by the culture around investing.

Investing is a proven way to build wealth over time regardless of sexual orientation, gender identity, race, or ethnicity. Being a first-time investor can be intimidating, but there are many resources and guides to get started, including:

• How to Invest Money
• What to Invest In
• How to Invest in Stocks

A non-retirement investing account or a brokerage account provides investors with access to their investments at any time, as well as freedom over what to invest in. Retirement investment accounts, such as a 401(k) or IRA, offer tax advantages compared to brokerage accounts but have penalties for withdrawing funds if the owner is younger than 59.5 years old. They also provide investors with less choice about what to invest in.

Trends

60% LGBTQ+ Americans with a brokerage account add funds at least once a month

60% of respondents with a brokerage account said they add funds at least once a month. That’s down just 1% from the previous year despite tough market conditions.

Respondents are less likely to be adding funds weekly and instead are slightly more likely to add funds monthly compared to last year.

LGBTQ+ Americans are more likely to have student loan debt, credit card debt, and personal debt, but they’re less likely to have auto debt and a mortgage

LGBTQ+ Americans are more likely to have student loan debt, credit card debt, and personal loan debt than the national population, but they are less likely to have auto loans or a mortgage.

The LGBTQI+ Economic and Financial (LEAF) Survey found that 82% of LGBTQI+ Americans have some type of personal debt. Forty-eight percent have more than $10,000 and 20% have $50,000 or more in personal debt.

Credit card debt, student loan debt, and personal loan debt can create financial and emotional stress. Credit card debt and personal loan debt in particular can come with high interest rates and can be difficult to pay off.

Auto loan debt and mortgage debt, on the other hand, are more manageable debts for many. Auto loans and mortgages are often the only ways to finance the purchase of a car and home, and paying off a mortgage builds home equity.

The disparities in these categories show that LGBTQ+ Americans, compared to all Americans, are more likely to have financially burdensome debt and are less likely to have debt, such as a mortgage, that can help them build wealth over time.

The percentage of respondents with credit card debt and personal loan debt is up slightly from 2022, as is the overall amount of debt in America, particularly credit card debt.

LGBTQI+ Americans are more likely to have taken out student loans for higher education and are less likely to have fully paid them off, according to the The LGBTQI+ Economic and Financial (LEAF) Survey.

LGBTQ+ Americans have more credit card debt than the average American

LGBTQ+ Americans carry slightly more credit card debt than the national average, but they carry less student loan and personal debt even though they are more likely than the average American to have these kinds of loans.

The median credit card debt among LGBTQ+ Americans surveyed is $3,000, while the median credit card debt among all Americans is $2,700.

LGBTQ+ Americans hold a median of $20,000 in student loan debt, which is $22,000 less than the national average.

LGBTQ+ respondents report having roughly a third the amount of personal loan debt carried by the average American, $5,000 to $16,000.

LGTBQ+ Americans are less likely to have a credit score between 800-850 than the overall U.S. population

A lower percentage of LGBTQ+ Americans have an excellent (800–850) or very good (740–799) credit score than the overall population, while they are more likely to have a fair (580–669) or good (670–739) credit score.

Credit scores are important. They are used to determine whether a bank will provide a loan, a borrower's interest rate, and which credit cards a person qualifies for.

Overall, 70% of LGBTQ Americans have a good or better credit score. Transgender Americans are most likely to have a good or above credit score (73%).

Twenty-four percent of LGBTQ+ Americans have a credit score between 740 and 799 compared to 25% of all Americans.

Just 8% of the LGBTQ+ community has a credit score in the excellent range compared to 21% of the overall population.

Notably, 10% of LGBTQ+ Americans say they don't know their credit score. Knowing your credit score is necessary in order to understand what types of financial products, including credit cards and loans, may be available to you and at what rates. Thankfully, there are a number of free ways to check your credit score.

Results from the LGBTQI+ Economic and Financial (LEAF) Survey were less positive. That study found that 53% of respondents had a credit score below 700. It also found that 20% didn’t know their credit score.

LGBTQ+ Americans have less savings than the overall population

LGBTQ+ Americans have less non-retirement savings than Americans overall, with just 9% of respondents having more than $20,000 in savings compared to 20% of the overall population.

Transgender Americans tend to have more savings than lesbian, gay, and bisexual Americans and those who are genderqueer/nonbinary. With the average American's savings balance sitting at $4,500, transgender savers are doing well.

The 2023 LGBTQI+ Economic and Financial (LEAF) Survey had bleaker findings: that 51% of LGBTQI+ Americans have less than $5,000 in savings.

Not making enough income is the most-cited barrier to saving more among LGBTQ+ Americans

What's keeping LGBTQ+ Americans from saving more? Not making enough income is the most-cited reason, with 57% of respondents saying their earnings are the primary barrier to saving more.

The percentage who say their income is what’s stopping them from saving more is up 11% from 2022 -- a reflection of inflation eating into the Americans’ paychecks.

Just 12% of LGBTQ+ Americans are happy with how much they’re saving -- down 7% from 2022. A general rule is to have savings worth 15% to 20% of your annual salary.

Ten percent of our respondents said they would rather invest their extra money. While savings accounts do provide interest, investing can yield better returns over a longer period of time.

Fifteen percent of LGBTQ+ Americans say they lack the discipline to save more. One remedy is to put your savings on autopilot by setting up automatic deposits into your savings account.

LGBTQ Americans are about as likely as all Americans to have employer-sponsored healthcare

While LGBTQ+ Americans are about as likely as the overall population to have healthcare, a similar percentage also has employer-sponsored health insurance as all Americans.

Access to healthcare is a fundamental part of financial freedom. Health emergencies can lead to major financial strain or even bankruptcy, and health insurance can make those emergencies more financially manageable.

35% of LGBTQ+ Americans who have employer-sponsored health insurance aren’t able to cover their partner

Many Americans have the option to join their spouse's employer-provided health insurance, which can get them better coverage or lower premiums. However, 35% of LGBTQ+ Americans are not able to add their partner to an employer-provided health insurance policy.

Nine percent say their employer only covers married couples, 15% say their employer doesn’t provide partner coverage, and 8% say their employer doesn’t provide same-sex partner coverage. Those numbers are generally flat compared to last year.

More than 90% of employers offer health insurance that can provide coverage to an employee's spouse, but only 74% of employers offered same-sex spousal health benefits, according to data collected by the Kaiser Family Foundation in 2020.

Financial well-being

The state of LGBTQ+ financial well-being

LGBTQ+ Americans face unique challenges when it comes to financial well-being. Nearly half of them have faced discrimination by someone in financial services, and two-thirds carry a high amount of financial stress.

They tend to not have the same financial tools and have fewer savings than the broader U.S. population. They are less likely to have a credit score in the "excellent" range, a mortgage, or auto loan debt while being more likely to have credit card debt, student loan debt, and personal loan debt.

LGBTQ+ Americans face structural barriers as well -- many cannot choose to be covered by their partner's employer-provided health insurance, for example.

"With this dearth of financial education and support in both childhood and adulthood for queer Americans, it’s no wonder that we carry a high amount of financial stress and the number of us who use important financial tools and who feel comfortable making important financial decisions continue to languish,” said Auten-Schneider. “It’s as critical now as ever to bridge the gap between the LGBTQ+ community and the industry, products and services that can help us.”

Making progress on any of these issues requires first acknowledging that LGBTQ+ Americans face financial disparities and outright discrimination. Individuals, companies, and other organizations can create a more inclusive and equitable financial system with a better understanding of the financial state of LGBTQ+ Americans.

Fortunately, there are financial professionals and LGBTQ+ content creators who are actively working to educate and support members of the community in their efforts to gain financial equality.

Sources

• Center for American Progress (2023). “Discrimination and Barriers to Well-Being: The State of the LGBTQI+ Community in 2022.”
• Center for LGBTQ Economic Advancement and Research; Movement Advancement Project (2023). “The LGBTQI+ Economic and Financial (LEAF) Survey: Understanding the Financial Lives of LGBTQI+ People in the United States.”
• The Federal Reserve (2020). "Survey of Consumer Finances."
• GLAAD (2022). “Unsafe in America: Annual GLAAD Accelerating Acceptance Study Finds Sharp Increase in LGBTQ Americans Experiencing Discrimination.”
• The Human Rights Campaign. “The Wage Gap Among LGBTQ+ Workers in the United States.”
• Journal of Epidemiol Community Health (2023). “Sexual orientation, gender expression and socioeconomic status in the National Longitudinal Study of Adolescent to Adult Health.”
• Kaiser Family Foundation (2020). "Access to Employer-Sponsored Health Coverage for Same-Sex Spouses: 2020 Update."
• LIMRA (2021). "2021 Insurance Barometer Study."
• National Center for Transgender Equality (2024). “Early Insights: A Report of the 2022 U.S. Transgender Survey.”
• Pew Research Center (2021). "16% of Americans say they have ever invested in, traded or used cryptocurrency."
• United States Census Bureau (2021). "American Community Survey: Income in the Past 12 Months."

United States Census Bureau (2021). "Health Insurance Coverage in the United States: 2020."

Methodology

The Motley Fool, in partnership with the Debt Free Guys, surveyed 2,000 Americans on May 11, 2023, via Pollfish. 50% of respondents identified as lesbian, gay, or bisexual; 35% identified as transgender; and 15% identified as genderqueer/nonbinary. Results were post-stratified to generate nationally representative data based on age, gender, and income. The same survey was previously run in partnership with the Debt Free Guys on April 18, 2022, via Pollfish.

What about asexual/intersex/demisexual individuals? Or any other queer-identifying group?

The decision to focus on lesbian, gay, bisexual, transgender, and genderqueer/nonbinary Americans came after reviewing available data and much reflection on how to best serve the LGBTQ+ community.

There are many other people who fall under the LGBTQ+ umbrella, including asexual, aromantic, intersex, demisexual, androgyne, neutrois, agender, pansexual, and many more. To effectively draw conclusions for all of these groups, a large enough sample size would need to be reached for these groups and more to justify making claims about their financial state. This was prohibitive in numerous ways, and, as a result, broader definitions were used and focus was placed on the largest and most visible groups.

In no way is the intention to downplay the importance of any other LGBTQ+ groups.

LGBTQ terms

The following terms are used throughout this article:

• LGBTQ+: Lesbian, gay, bisexual, transgender, and queer. The plus sign indicates there are many identities not covered by these terms that are still part of the community.
• Lesbian: A woman who is romantically or sexually attracted to other women. Nonbinary people may also use this term to describe themselves.
• Gay: A term describing a person who is romantically or sexually attracted to members of the same gender. In the context of LGBTQ+, "gay" usually refers to men since "lesbian" covers women who identify as gay (although women may use the terms interchangeably).
• Bisexual: A person romantically or sexually attracted to more than one sex, gender, or gender identity.
• Transgender: A term describing a person whose gender identity is different from the sex they were assigned at birth. Some, but not all, nonbinary people identify as transgender.
• Queer: A term used in many ways within the LGBTQ+ community, most often as an umbrella term for non-heteronormative identities (whether they be sexual orientations, gender identities, or something else).
• Genderqueer: A term generally used to indicate a person who does not accept or follow traditional binary gender roles or norms.
• Nonbinary: A person who does not identify exclusively as a man or a woman. There are many more specific categories that fall under nonbinary, including agender, bigender, genderfluid, and others.