Financial Planning for LGBTQ+ Families

by Daniella Flores |December 14, 2022

If you've decided to start a family — congratulations! As much of a personal decision as this is, it's also a financial one.

The prospect of parenthood is exciting, but it can also be complicated and expensive, especially for LGBTQ+ families who often have to navigate additional legal barriers — for example, around foster and adoption laws, parental recognition laws and family leave policies in certain states.

Despite these challenges, the LGBTQ+ parenting community is growing. A 2019 LGBTQ Family Building Survey by Family Equality found that the gap in parenting rates between the LGBTQ and non-LGBTQ communities has narrowed significantly.

The same report found that 77% of LGBTQ+ millennials (between the ages of 18 and 35) surveyed were either already parents or considering having children — a 44% increase over earlier generations.

With more LGBTQ+ people taking the leap into parenting, there is a greater availability of information and resources to help you navigate the needs of your future family. Read on for tips on planning for a family as well as some first-hand experiences of LGBTQ+ families.

A couple researching on a laptop while while their children play

Budgeting for baby

As with most major life decisions, considering the costs and how you'll meet them is key. That starts with deciding how to bring a child into a family. There are multiple pathways to having children — including conception, surrogacy, adoption and foster care — and a range of costs for each, which can vary depending on your health insurance coverage and the state where you reside.

For example, according to the American Society for Reproductive Medicine, the average cost in the U.S. for one cycle of in vitro fertilization (IVF) is $12,400. If thinking about adoption, Family Equality reports that domestic adoptions of infants through either an adoption agency or an attorney range from $20,000 to $45,000.

No matter what path to parenthood you take, start by doing your research. Be clear on what your health insurance covers. Be aware of various laws in your state. Resources like the Movement Advancement Project (MAP) offer helpful information on local LGBTQ+ policies, including those related to family planning. Foster and adoption laws differ by state, so you'll need to be aware of the policies where you reside.

A couple getting their daughter off to school

Prepping for the long term

Once you're aware of the options available and associated costs, you can begin to formulate a plan and create a budget. A zero-based budget (the aim is that your income, minus expenses, nets out at zero every month) is ideal for this. When saving for a large financial goal like family planning costs, you'll want to give every dollar you earn a job.

But planning doesn't end when the baby arrives. Childcare costs at each stage of life — from paying for diapers and formula to daycare and after school programs — add up. It's important to get into the good habit of having an emergency fund. Start by saving at least 3-to-6 months' worth of your living expenses.

Finally, take advantage of all the benefits available to you through your employer. For example: if you have health insurance through work, check out their adoption benefit offerings. Be clear on maternity and paternity leave policies.

Lewis recommends benefits like Health Savings Accounts and reaching out to your health insurance company, "to see if they have programs for LGBTQ+ couples trying to start a family," says Lewis. "You can also utilize Employee Assistance Programs (EAP) through your employer to see if there are programs that can help you."

Preparation can promote some peace of mind and help regulate emotions. And, less money problems throughout the process will help free you up to focus on the bigger dream ahead.

Daniella Flores

is a queer, non-binary, and Latine artist, software engineer and creator of the award-winning money and side hustle blog for creatives and LGBTQ+ folks, I Like to Dabble. Daniella's work has been featured on TIME, Investopedia, MSN, CNBC, LA Times and Business Insider.

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