Correction to This Article
The Futures column in the Aug. 26 Business section contained an outdated name for a group that advocates for gay, lesbian, bisexual and transgender people older than 50. It is called Services and Advocacy for GLBT Elders.

Same-Sex And Worried About Retirement

By Martha M. Hamilton
Sunday, August 26, 2007

Ken Hausman and his partner, Deane Bergsrud, have been together for 27 years, and like many couples their age, they're thinking ahead to retirement. They both have 401(k) plans at work and individual retirement accounts, and Hausman has a pension.

Nonetheless, "we worry a great deal about the future," Hausman said.

One of their worries is whether the surviving partner will be adequately protected when the other dies -- because of their unmarried status.

Unmarried couples lack the automatic legal protections that kick in when one member of a married couple dies. And they lack other advantages in planning for financial security in retirement that are taken for granted by most couples.

But marriage is a solution that is unavailable to Hausman and Bergsrud. They live in Virginia, where marriage is prohibited for same-sex couples, as it is in most of the United States.

Together they make a decent income that has allowed them to save for retirement, and they have little debt. But they worry whether they have done everything they need to do to ensure that one won't be left with too few assets after the other dies. Compounding their worries is a Virginia law that prohibits civil unions or other marriage-like contracts between same-sex partners.

The law is being challenged, but as long as it's on the books Hausman says he worries that the wills and powers of attorney, and other measures they have taken to protect each other, could be ruled null and void.

"There's no substitute for being married when it comes down to it," he said.

In terms of their 401(k)s and IRAs, the two think they are in good shape. Each has named the other as the beneficiary of the savings accounts. But Hausman, associate editor of Psychiatric News, also has a traditional pension. Normally workers with traditional pensions can choose at retirement whether to take the full monthly payments or a reduced amount each month in order for those benefits to continue for a spouse's lifetime, should the pension beneficiary die first.

It's a benefit considered so important for the surviving spouse that he or she has to sign a waiver for the worker receiving the pension to qualify for the higher benefits. But pensioners in same-sex couples can't leave survivor benefits to their partners.

Legal experts from the gay and lesbian community say that is just one of many ways in which financial planning for retirement is complicated for same-sex couples. Other examples were given by Susan Sommer, senior counsel for Lambda Legal; Joan M. Burda, who wrote "Estate Planning for Same-Sex Couples"; and Michael Adams, executive director of Senior Action in a Gay Environment:

  • Social Security. There are no survivor's benefits available to members of a same-sex couple, nor can a low-earning member of a same-sex couple get the boost in benefits available to a married couple when both of them are alive. If one member of a married couple is receiving less from Social Security than his or her spouse, the survivor can draw 100 percent of the dead spouse's benefit, if he or she is old enough to draw full Social Security benefits. This is true for ex-spouses, too, if the marriage lasted 10 years or longer.

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