This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Same-Sex Couples' Not-So-Golden Years

BOSTON ( TheStreet) -- As same-sex couples are increasingly being granted rights similar to those of traditional marriages, many will be at a comparative disadvantage as they enter retirement.

The study by the Williams Institute at the UCLA School of Law says gays and lesbians will have less retirement income and fewer ways to pass savings on to their families after their death. Merrill Lynch, a unit of Bank of America (BAC - Get Report), helped fund the report.

A large share of same-sex couples will be entering retirement in the next two decades, just as states open marriage and civil-union laws. There are about 1.2 million gay people living with a same-sex partner in America, according to the most recent U.S. Census.

Inequality in retirement savings needs to be addressed, says Naomi Goldberg, author of the survey, titled "The Impact of Inequality for Same Sex Partners in Employer-Sponsored Retirement Plans."

The study, citing census statistics, shows that traditional couples earn an average of 4% more in combined household retirement income each year compared to same-sex couples. It claims, however, that the statistic only tells part of the story.

Same-sex surviving spouses can't directly receive the balance of their deceased spouse's 401(k) plans. Because they must begin making withdrawals immediately, they face a higher tax rate and the loss of accruing interest. Surviving same-sex spouses also pay higher estate taxes.

"The bulk of these inequalities are a direct result of the Defense of Marriage Act (DOMA), which forces the federal government to treat same-sex couples differently than married couples when it comes to retirement savings or estate taxes after death," Goldberg says. DOMA was passed under President Bill Clinton.

There have been changes that have benefited gays and lesbians. The Pension Protection Act of 2006 gives surviving partners of same-sex relationships access to retirement assets.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
BAC $16.36 0.00%
AAPL $113.29 0.00%
FB $91.01 0.00%
GOOG $630.38 0.00%
TSLA $248.48 0.00%

Markets

Chart of I:DJI
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 +1.21 0.06%
NASDAQ 4,828.3250 +15.6170 0.32%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs