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The LGBTQ millennial community face social challenges many of their generational counterparts do not, and there’s growing evidence that is taking a toll on their finances.
LGBTQ millennials have more student debt, lower average income than peers and, overall, feel less financially secure, according to recent surveys.
Seventy-one percent of LGBTQ individuals with a bachelor’s degree have student loan debt, and almost one-fifth owe more than $100,000, according to a TD Bank survey. Only 50% of respondents rated their current financial situation positively.
In some respects the financial struggles of this community match a larger economic inequality problem in the U.S., but the problem is even greater among LGBTQ individuals. Sixty percent of LGBTQ workers have less than three months in emergency savings, according to the TD Bank study. A recent Federal Reserve study showed that 40% of American adults could not handle a $400 emergency expense.
Similar surveys show the financial standing of LGBTQ millenials is bleaker than that of the rest of their generation. A 2018 TD Ameritrade survey found LGBTQ millennials on average made $59,400 a year, while their straight counterparts earned $67,800. Likewise, 41% of straight millennials surveyed felt financially secure, while only 29% of LGBTQ millennials concurred.
“Unless we have economic equality for all, the members of the LGBTQ community will continue to struggle to achieve financial success,” said Jonathan Lovitz, senior vice president at the National LGBT Chamber of Commerce.
Sexual orientation discrimination and a lack of family support are factors.
A Morning Consult poll done for WNYC found 1 in 4 queer individuals say their sexuality or gender identity has impacted their finances. In addition, 35% stated they could rely on family and friends for financial support before coming out, while only 20% could say the same afterward.
“We need to do more to show young people that being out and successful are not mutually exclusive,” Lovitz said. “Once we have secure economic equality for all, there is no limit to how high they can fly, or how big of a role model they can be.”
Reaching this sense of economic equality may include expanding the personal finance resources available to this community. Investing options for LGBTQ individuals are growing and so are financial advisors who focus on this community.
TD Bank’s survey also found continued workplace discrimination cited by LGBTQ workers. More than one-fifth of the survey group feared coming out to their senior management, saying it could hurt their chances for future professional advancement, and almost 80% do not have an LGBTQ resource group at their workplace.
LGBTQ individuals do have growing influence in one respect: who they choose to work for and buy from.
Companies who fail to take an activist stance may find it harder to attract millennial talent and consumers. The TD Bank survey finds almost two-thirds of millennial workers look at the LGBTQ policies and inclusiveness of an organization before seeking employment. In addition, 75% of purchases made by LGBTQ members are influenced by the company’s history of supporting gay rights, according to Lovitz’s research.
—By Joe Andrews and Valentina Sanchez, special to CNBC.com
Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.