Mostinvestors face complex challenges when it comes to retirement, including how to save enough to feel comfortable, where to invest retirement savings, and understanding and creating retirement income options. LGBT pre-retirees face these challenges as well as some that are unique, stemming from a lack of federal marriage and inheritance rights, according to a Wells Fargo Retirement survey.
For assistance, some LGBT investors turn to advisers who specialize in planning for people in domestic partnerships. The Accredited Domestic Partnership Advisor (ADPA) program was created with the College for Financial Planning to educate advisers about the financial considerations of people who enter domestic partnerships.
Approximately one in 10 LGBT respondents is aware of the ADPA designation, and most gay men (60%) and lesbians (72%) say these credentials are important to them when working with an adviser.
LGBT non-retirees reported a higher level of confidence in retirement savings compared with the general population, the survey also found.
A majority of LGBT non-retirees (61%) felt confident that they will have enough saved to live the lifestyle they want throughout retirement, compared with 53% cited by the general population. However, more than a third (36%) of LGBT non-retirees expect to work in retirement to afford their lifestyle—only slightly lower than the general population expressing this view (41%).
The median amount LGBT non-retirees have saved for retirement is only 17% of what they believe they actually need. Survey respondents believe they will need to save at least $900,000 in order to retire, and have saved on average about $150,000. And despite this need to save more for retirement, three out of five (62%) of non-retirees have not increased their retirement savings allocation in the past year.
A majority of LGBT respondents reported they would find value in information and advice on investing and preparing for retirement. Additionally, only about a quarter of the LGBT respondents currently had a detailed written plan for their finances in retirement.
Richard Day Research, a market research firm, conducted the survey online on behalf of Wells Fargo Retirement between December 2 and December 18. Adults 25 to 75 who identified themselves as lesbian, gay, bisexual or transgender participated in the study.