LGBTQIA+ couple taking a family photo.

Financial stress rose in the LGBTQIA+ community this year, but many see a way out

A recent N26 survey tells a story of financial insecurity brought on by the pandemic, but also offers a glimmer of hope.

7 min read

Since its onset in March 2020, the Covid-19 pandemic has highlighted and exacerbated issues of financial inequality in Europe. While the European economy has suffered across the board, the financial outlook for individuals looks a lot more complicated. Some people were able to cut back on spending and grow their savings, while others saw their employment opportunities dry up and debts continue to mount.

Different communities experienced the pandemic’s economic impact in different ways, as well. After launching our campaign at N26, we were interested in learning more about how the pandemic has affected the LGBTQIA+ community. To that end, we surveyed 3,750 self-identified members of the community across six European markets—Germany, Spain, Italy, France, The Netherlands and Ireland—to better understand their specific pressure points and challenges.

What we found is hardly surprising: financial stress went up in the LGBTQIA+ community as a result of the pandemic, largely due to rising personal debt and dwindling income. But, while our data tells an unmistakable story of insecurity, it also offers a glimmer of hope. Many members of the LGBTQIA+ community remain optimistic about the future and see a promising financial picture ahead of them—and so do we.

In this article, we’ll discuss the findings from our survey and provide some tips for coping with financial stress. We’ll also share some resources specifically for LGBTQIA+ individuals who may be experiencing financial stress and need a little extra help. 

How Covid-19 has affected the LGBTQIA+ community’s financial outlook 

The LGBTQIA+ community is large and diverse, and the experience of individuals varies widely. With that said, our survey results indicate that the pandemic has had a notably detrimental effect on many members of the LGBTQIA+ community—with many experiencing a significant rise in personal debt.

Financial outlooks for LGBTQIA+ communities vary across Europe

Among the European markets we surveyed, over half of Italian (53%), Spanish (52%) and Dutch (52%) respondents described their financial situation as average or worse. And while smaller percentages of French (47%), Irish (41%) and German (38%) respondents described their overall financial situation in this way, many continue to struggle with mounting debt.

The case of LGBTQIA+ individuals in Germany is a particularly interesting example. Though the Germans we surveyed generally described their financial outlook in healthier terms than their counterparts, their personal debt is on average higher—57% of German respondents claim to be in debt, versus 47% of respondents overall.

Germans also top the list of LGBTQIA+ respondents whose finances have been most adversely affected by the Covid-19 pandemic. Slightly more than two-thirds (67%) claim that their personal debt is higher now than it was prior to Covid-19, compared to 45% overall.

Rising debts and dwindling incomes lead to financial stress

Of course, debt is only one side of the equation. The Covid-19 pandemic also took away jobs and other sources of income, becoming a key driver of increased financial stress.

Our survey data indicates that job loss, low income and unemployment were among the biggest contributors to debt among LGBTQIA+ individuals internationally. (Other top contributors were credit card debt and medical expenses such as health issues, gender-affirming surgeries, or hormone therapy.)

With all of these factors at play, it’s no surprise that financial stress and anxiety became more acute among the LGBTQIA+ community during the pandemic. But our survey also found that there’s an underlying sense of hope and optimism within the community about what lies ahead.

Many in the LGBTQIA+ community are hopeful for a better financial future

Indeed, the takeaways here are hardly all negative. Many of those surveyed were accepting of the unforeseen circumstances we’ve all been faced with—and they continue to be optimistic regarding their future prospects.

Depending on the market, between 22–30% of respondents were confident that they’d be able to clear their personal debts within the next two to five years. LGBTQIA+ individuals in the Republic of Ireland seem particularly positive about the likelihood of paying off their personal debts quickly, as nearly a third (29%) claimed they’d be debt-free within six months.

Finding ways to deal with financial uncertainty

Even when you have a rock-solid plan for paying off debt in the long-term, it can be a struggle to deal with daily financial stressors. And with the pandemic introducing so many new financial variables, those stressors have become more common among members of the LGBTQIA+ community.

But how, exactly, does financial stress manifest itself? How can it impact a person’s broader wellbeing and relationships? And what, if anything, can be done about it?

How to cope with financial stress: 3 strategies

We recently dissected and how it presents itself in the brain. While nobody is fully immune to mental and emotional symptoms of financial stress, there are ways to regain a sense of control and empowerment that might bring you some relief.

Let’s take a look at three strategies you can use to do just that.

1. Take control of your financial picture

The first step to overcoming financial stress is fairly simple: control what you can. Take some time to sit down and intentionally plot out how much money you have coming in and how much you have going out on a monthly basis.

This will give you a clearer overview of your spending habits—and clarity, in itself, can be a powerful stress-reducer. But it will also help you better plan for those things you can’t control, like medical bills and other unexpected challenges. Speaking of which…

2. Make a plan—and stick to it

If you’re not sure how much you should be saving versus spending, you might want to use a budget-planning method to help you get there. We love the for this purpose.

One of the most important parts of sticking to a plan is to not get too fazed if you stray from it slightly. If there’s one thing we’ve learned from recent events, it’s that the unexpected is never as far away as we’d like to think. The most important thing is to readjust after setbacks and look to regain your footing as soon as you’re able.

3. Work on other areas of stress in your life

It’s unlikely your financial difficulties will disappear overnight. But that doesn’t mean you can’t take steps right away to ease your stress levels and find the peace of mind to better deal with challenges in the long-term.

Rightly or wrongly, financial problems can cause you to feel discouraged and impact your self-esteem. Try and find other, more rewarding ways to improve your sense of self-worth.

Even when you’re struggling yourself, it can be relaxing and rejuvenating to help others in need—whether by volunteering or simply being a friend and ally to those in your community. And if you still need some help to get through a stressful time, there are plenty of places you can turn to.


Resources to help LGBTQIA+ community members deal with financial stress

The most important takeaway from this article —even more important than the survey itself—is that there are many useful financial tools and resources out there that offer help to members of the LGBTQIA+ community. Here’s a list of 5 resources we can recommend for great advice:

  • (Republic of Ireland)—Gay Financial is committed to helping the community find the very best financial advice. The chartered financial advisers they work with are great at what they do, and they’ve been handpicked to ensure a positive customer experience for LGBTQIA+ individuals. 
  • —Equality Wealth is the first international specialist to provide access to tailored solutions for the LGBTQIA+ community. Recognizing that many members of the LGBTQIA+ community may not have financial advisers who truly understand their needs, they ensure that they work only with financial experts specifically trained in LGBTQIA-related issues.
  • —David Auten and John Schneider are personal-finance authors, bloggers, and speakers with more than 35 years of combined experience. Their show and podcast, Queer Money, discusses the financial nuances in the LGBTQIA+ community.
  • —Auten and Schneider also run a personal-finance website, Debt Free Guys, that specializes in resources for the community.
  • —ILGA-Europe is an international organization working to drive political and social change for members of the LGBTQIA+ community throughout Europe. Their regularly features helpful information about how to get involved and their website even features a on the community.

By N26

The Mobile Bank

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