Between the socialist millennials who want everything to be open access and free to the affluent travelers who can pop off to Mykonos at the drop of a hat and the spendthrift seniors paying for nursing care with Medicaid, LGBT folks run the gamut when it comes to money, their access to it, and beliefs about it. A new survey from Experian offers some interesting insight.
We think we save more than we do
Asked to characterize their habits on a zero-to-10 scale, with zero denoting “spender” and 10 denoting “saver,” more than half (52 percent) of LGBTQ respondents placed themselves in the 6-to-10 “saver” range.
But responses to more detailed follow-up questions gave a decidedly different impression:
• 44 percent of LGBTQ respondents said they struggle to maintain adequate savings versus 38 percent of the general population.
• Just over one-third (34 percent) said they have bad spending habits that they’d like to improve or change versus 28 percent of the general population.
• LGBTQs estimated they devote 16 percent of monthly income to discretionary spending but just 11 percent to saving or investment.
It’s worst for millennials, ages 25 to 34
• 53 percent of respondents in that age group reported struggling to maintain savings.
• 49 percent disagreed with the statement “I am in control of my finances” versus a range of 56 to 58 percent of those aged 35 to 64 and 75 percent for those 65 and up.
• 49 percent of the 25- to 34-year-olds reported having bad spending habits—a condition that diminishes with “remarkable consistency among members of older LGBTQ age segments.”
Our financial priorities
• 29 percent save for retirement.
• 20 percent are paying off debt.
Money (or lack of) equals stress
A recent survey by Honeyfi, a budget app that helps couples manage their money together, asked 300 LGBTQ-identified couples about their money issues. They found that 82 percent of couples worry about money at least once a month, with 58 percent of respondents admitting to feeling anxious at least once a week.
Are you spending too much?
The survey showed that LGBTQ people “find it more important than their non-LGBTQ counterparts to set aside money for entertainment.”
“It boils down to priorities,” says David Rae (pictured below), a certified financial planner specializing in the LGBT community. “If you look online at financial planning sites, one of the first things they talk about is saving for kids’ college education. Since many [in the LGBTQ community] don’t have children, they’ve got way more money to spend on housing or a car or travel.”
Those between the ages of 25 and 44 spend more on nearly every category (from clothes to entertainment, fitness, hobbies, dining out, and partying) except for one: travel. LGBTQ respondents over 65 prioritized travel more than any other other age group.
LGBTQ respondents in the 25- to 34-year-old age group reported overspending at significantly higher rates than older counterparts in the areas of personal hygiene (26 percent), clothing (38 percent), and dining out (53 percent). But 46 percent of all LGBTQ respondents said they spent too much money dining out. “Eating is often a matter of going out for a great meal with your friends, not just feeding your family,” Rae says.
Twenty-five percent of those 25 to 34 (and 18 percent of LGBTQ respondents overall) have no credit cards at all.
How the rest of us use cards
• 70 percent use them to purchase necessities.
• 55 percent use them for rewards (like cash back, hotel stays, or airline miles).
• 32 percent of all age groups say they use credit cards to improve or build creditworthiness, with 50 percent of LGBTQ respondents age 25 to 34 giving that reason.
Bias and discrimination
A significant majority (62 percent) of LGBTQ respondents reported having experienced financial challenges because of their sexual orientation or gender identity.
Discrimination impacts our finances
Ten percent of all LGBTQs have experienced lower salaries, 12 percent were passed over for a job, 13 percent faced harassment or discrimination at work.
Source: Experian online survey (May, 2018).