- The right planning can make the difference between a great retirement and a nasty shock.
We met almost 20 years ago when we were both working as airline cabin crew. We both had a passion for travel but always dreamed of settling down.
Little did we imagine that 20 years later, we would be living in the countryside with three dogs (and one more on its way!). We’ve also set up a business together to help the LGBT+ community in England’s East Anglia plan for living their dreams.
We very recently established an LGBT+ advisory firm. Our firm works with LGBT+ specialists Equality Wealth to help other people in the community plan for the future.
Like many same-sex couples, we aren’t married. However, we have discovered many of the issues life throws at partners – and why those problems can be knottier for a same-sex couple.
Meanwhile, COVID 19 means that, like many other couples, we’ve ended up working at home together. Moreover, we have not been able to have face-to-face meetings with our clients.
So we want to share the key issues facing our community as people plan their financial future. And we want to see what lessons we can learn from living through the global coronavirus pandemic.
Why do we sometimes see partnership differently?
We’ve found that LGBT+ people still think of being in a ‘couple’ in a different way to the straight world.
You don’t have to be a very old LGBTI person to remember a time when being open about having a partner could prove difficult. Being able to marry the person you loved seemed an impossible dream.
It was still illegal to be gay in the 1960s. And if you were born in that decade or before, your younger life was very different to an LGBT+ person today. The only thing you heard about being gay was there was something wrong with us. We were queer, weird and potentially a criminal.
Many people of those generations have spent much of their life in the closet. Indeed some never felt comfortable to come out.
Consequently, it’s hardly surprising that so many of us still find it difficult to talk openly about our sexuality. Even those of us running an LGBTI business!
It’s also no surprise we typically don’t follow the ‘norms’ of a ‘straight lifecycle’. In other words, meet a boy or girl, settle down, marry, have kids.
The take-up of marriage or civil partnership is still quite low among same-sex couples. Therefore, most same-sex couples still don’t enjoy the legal protection that marriage offers.
We hope we’ll be able to help LGBT+ people of all generations to plan for their future.
Financial protection for same-sex couples
Because we don’t always take those steps, we often forget to do other things to protect our partners too.
Many couples keep their finances separate. This can be a significant issue for protecting our partners. You may expect older couples to have had the time to sort it out. But in fact, they are even less likely to have a joint financial plan or even a joint bank account.
Older LGBT+ people are often uncomfortable talking to advisors about their sexuality. As a result, they often don’t get adequate advice on how best to protect their partners. Financial advisors generally aren’t used to asking the right questions either, making matters worse.
If that problem doesn’t scare you, then it should.
We have come across people in long-term, loving partnerships who lost their home and assets when their partner died. They simply had not considered protection and maybe weren’t open to their partner’s family.
We believe our experiences, including setting up a business together, may help others with the issues they face.
Even marriage doesn’t solve everything
The rights we now enjoy in the UK put same-sex and opposite-sex couples on a level playing field.
But, even if you marry, you may not be treated the same outside the UK. If you travel or move overseas to a location that doesn’t recognise your marriage or partnership, you may find you have less or no protection.
Indeed, this came into sharp focus during the pandemic as many people were trapped abroad, away from their partners.
Problems for all partners, gay or straight
Some issues that LGBT+ people face are the same as those faced by everyone else. A lot of these can be simply solved, if you go and get good advice. These include:
• Insurance protection on mortgages or loans to cover both of you, not just one.
• Protection in the event of being unable to pay your mortgage payments due to illness.
• Having a will in place and assets held correctly to ensure your partner is protected in accordance with your wishes if you should die first.
• Planning your retirement with enough protection to make sure you can live your older years as you wish.
Particular issues for same-sex partners
But there are also issues you are more likely to face if you are part of a gay or lesbian couple:
• LGBT+ retirement can cost more than for straight people and yet we are often less prepared for it. COVID-19 has highlighted to many of us the things we value that can be taken away. So it’s even more important than ever to be planning for retirement.
• Because fewer same-sex couples are married, they don’t have the same legal protections. In a worst case, you could lose your home when you lose your partner.
• Inheritance tax in the UK could be a big issue (and an even bigger issue abroad) for you. Even if you are in a formal partnership, you may need extra planning to avoid a nasty shock.
Protect yourself and the person you love
There are several things you can do to fix this. The most important step is to start talking about it:
• When buying a home, make sure you get advice from someone who truly understands your situation. You need to be fully open with them.
• Ask how to get adequate protection for you and your partner on mortgages and loans.
• Planning for retirement with your partner is important. If you wish to spend your lives together, have a joint target and plan to reach retirement goals.
• Even if you are married, get advice on protection and future planning. This is true for everyone but doubly so if you plan to retire (whether in part or in full) to a country that doesn’t recognise your same-sex partnership.
We would love to help you plan for the future. And, like most dog owners, we’d also be happy to talk about doggy issues.
Iain and Daniel are part of LGBT+ specialists Equality Wealth which works exclusively with St James’s Place. If you’d like to talk to Iain and Daniel, contact us here.
Equality Wealth is a GSN client.