LGBTQ Workers Have Lower Retirement Confidence

The EBRI 2022 Retirement Confidence Survey also found LGBTQ Americans carry more debt than non-LGBTQ individuals.

Across income groups, LGBTQ workers are less confident in having accumulated enough savings to live comfortably in retirement, according to the 2022 Retirement Confidence Survey from the Employee Benefit Research Institute.

The survey included an oversample of LGTBQ individuals for an analysis of the retirement readiness challenges faced by LGBTQ workers. Compared to other retirees and pre-retirees, LGBTQ Americans have lower incomes and are less confident that they will have accumulated sufficient assets to live comfortably in retirement.

Higher income levels are closely correlated to elevated retirement confidence, said Craig Copeland, director of EBRI’s wealth benefits research, during “EBRI Focus on LGBTQ Americans – Results from the 2022 Retirement Confidence Survey,” a webinar on the study’s results. 

“The more income you have, the more likely you are to be confident that you and your spouse have enough money to live comfortably throughout your retirement years,” he explained. “But in each income group LGBTQ community members are less confident. It still goes up with income, but within each income level LGBTQ community members are less likely than non-LGBTQ community members to be confident that they will have a sufficient amount of income to live comfortably through their retirement years.”

Among upper-income groups represented—those with $75,000 annual household income and above—89% of non-LGBTQ Americans are confident about retirement, compared with 76% of LGBTQ Americans, data show. In this group, 32% of LGBTQ individuals are very confident they will be able to live comfortably in retirement, compared with 39% for non-LGBTQ workers.

At the lowest income group EBRI studied—less than $35,000 annually—among LBGTQ workers, 62% are not confident, 27% somewhat confident and 10% very confident about retirement, whereas for non-LGBTQ workers 54% are not confident, 32% are somewhat confident and 14% are confident about retirement.

Additionally, LGBTQ workers have less assets than non-LGBTQ counterparts, data show. The survey found that—outside of assets including a primary residence and defined benefit plan—66% of LGBTQ individuals who earn $35,000 and below have less than $1,000 in savings and investments, compared with 54% of non-LGBTQ individuals.

“Even when we control for income, non-LGBTQ Americans are more likely to have assets outside of a DB [defined benefit] plan and a home of $250,000 or more than LGBTQ community members, so there are clearly more assets for those in the non-LGBTQ community than for LGBTQ,” Copeland said.

For LGBTQ workers earning between $35,000 and $75,000, 29% have less than $1,000 in savings and investments versus 18% of non-LGBTQ workers, while 12% of LGBTQ workers in the middle-income group have $250,000 or more in savings and investments compared to 24% for non-LGBTQ individuals.

The disparity continues up the income ladder, as among workers earning $75,000 or more annually, 39% of LGBTQ workers have $250,000 or more in savings and investments versus 55% of non-LGBTQ workers who have $250,000 in savings and investments.  

LGBTQ workers also carry more debt than non-LGBTQ individuals. Among LGBTQ workers who earn $35,000 or less, 30% described their levels of debt as a major problem, compared with 24% of non-LGBTQ individuals.

“LGBTQ Americans are more likely to consider debt to be a major or minor problem for their household than non-LGBTQ Americans, across each income group,” the report states. “In the upper-income group, 64% of LGBTQ Americans consider debt a problem versus 39% of non-LGBTQ Americans. As a result, LGBTQ Americans are more likely to say debt is impacting their ability to save for retirement or emergencies.”

The 2022 EBRI survey included 2,677 Americans. It was conducted through an online panel from January 4 through January 26 of this year. All respondents were ages 25 or older. The respondents comprised 1,545 workers and 1,132 retirees, including an oversample of 807 surveys among LGBTQ Americans—639 workers and 168 retirees. The data were weighted by age, sex, LGBTQ status, household income and race/ethnicity, to provide nationally representative estimates.