December 5, 2023

Bucks: The Financial Hurdles Gay Couples Face

Bucks - Money Through the Ages

I profiled a lesbian couple, Amanda and Kay Shelton, for our special section Money Through the Ages. The Shelton’s home is pretty typical of many American couples in their thirties raising two young children — toys in the basement, baby monitors, requests for chocolate milk from little people.

But their union is not recognized by their federal and state governments, so their financial and legal lives are anything but typical. Since only Amanda has biological ties to the children and their home state doesn’t allow second-parent adoptions, she has been signing a permission slip of sorts, every six months, which provides Kay with parental consent.

Then there are the financial hurdles. Kay is the stay-at-home parent, so she doesn’t earn any income and therefore can’t contribute to an individual retirement account. And since they can’t obtain federal marriage status, Amanda can’t contribute to a spousal I.R.A. on her behalf. Kay won’t be eligible to collect Social Security benefits on Amanda’s earning record, either.

Given the scope of the issues they face, one financial guru was not sufficient. Instead, we had to gather three experts in same-sex issues to weigh in on their situation: a lawyer, a financial planner and an accountant. They came up with some creative solutions that attempt to put them on a level playing field with heterosexual married couples, but it’s still pretty lopsided. And it’s likely to remain that way until same-sex couples’ unions are recognized by the federal government.

If you (or someone you know) are in a similar situation, what sort of hoops have you had to jump through to protect your partner or children?

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