By Beth Pinsker
NEW YORK (Reuters) – A year after Travis Kelso-Turner and his husband got married, their to-do list of financial tasks still daunts them.
“I’m still finding times I have to fill out new paperwork because of the name change,” said the 30-year-old Las Vegas resident, who is executive director of the Executive Pride networking group for corporate executives advocating for lesbian, gay, bisexual and transgender rights in the workforce.
The most difficult job was adding his new husband to the deed and mortgage of the house they had bought together four years earlier, before marriage equality became the law throughout the United States.
That landmark Supreme Court decision in June 2015 is making a significant impact on the finances of the LGBT community because of the large increase in the number of same-sex married couples, surveys have found.
The rate of marriage in the LGBT community more than tripled in four years, to 26 percent in 2016 from 8 percent in 2012, according to a Prudential survey released on Thursday. The percentage of survey respondents with children also rose significantly, to 39 percent from 15 percent.
Among the top benefits of same-sex marriage are the ability to make healthcare decisions for a spouse and the access to a spouse’s insurance and healthcare coverage, according to a just-released study from Wells Fargo.
Also important: inheritance rights and spousal Social Security benefits.
The ability to file taxes jointly is more of a toss-up as the so-called marriage penalty means a couple is taxed higher together than individually.
Kelso-Turner and his husband, for instance, got hit with a big bill in their first year of “married filing jointly” because of their combined incomes and conversions they made to their retirement funds.
THE MARRIAGE BOOST
For the most part, though, “family formation is the key to creating wealth,” said RBC Wealth Management financial adviser Darla Kashian of Minneapolis.
That boost may be crucial to improving the finances of the LGBT community. The Prudential survey found those respondents lagged the general population in several key areas of financial security.
Only 40 percent of LGBT respondents said they had savings accounts, compared with 47 percent of the general population. The LGBT individuals also were behind in retirement, investing, insurance and estate planning.
Prudential also uncovered a significant wage gap along a spectrum. Heterosexual and bisexual men made more than gay men, and gay men made more than heterosexual women. Heterosexual women made more than lesbian women, with bisexual women at the lowest end of the pay scale.
The income gap is probably driving the differences in financial security, said Prudential Individual Life Insurance & Prudential Advisors Chief Executive Officer Kent Sluyter.
“There’s a drag that magnifies itself over time,” Sluyter said.
When Kashian came out at 18, her family did not accept her, and she had to support herself sooner than her peers. Now in her 50s, she said men of her generation, who came out in the early 1980s, simply did not think they would be alive today, so retirement planning was not on their minds.
“There’s an element of catching up when they come in now for financial planning,” Kashian said. “My message to clients is that you have to start where you are at.”
Christopher Street Financial Managing Partner Jen Hatch stressed the importance of making LGBT clients feel like they will not face rejection, especially in rural areas where there is not as much acceptance.
Hatch, whose New York firm specializes in LGBT financial planning, said some certified financial planners are Accredited Domestic Partnership Advisors who deal with the lingering specialized issues. One way to find a financial pro with the right skills is a site called Pride Planners (http://prideplanners.org).
“There are some really wacky outstanding problems that don’t apply to everyone,” Hatch said. “It’s still very specialized and creative.”
(This story has been refiled to add dropped letter to Wells Fargo in sixth paragraph)
(Editing by Lauren Young and Lisa Von Ahn)