A Legacy for the Kids? The Impact of Sexual Orientation on Pension Investment Motives in the UK

Abstract

Sexual orientation’s impact on retirement savings has rarely been examined. Three studies of UK pension savers found that actual pension savings (Study 1) and estimated pension savings (Study 2 and 3) did not differ by sexual orientation. Among a UK pension savings company’s customers (Study 2, N = 1043) and users of Prolific (Study 3, N = 275) motives to save were mostly endorsed similarly by sexual orientation, with one exception. Straight male pension savers reported greater motivation to save to pass money to dependents after death than sexual minority male savers did in both studies. However, sexual orientation did not predict saving motives consistently among women across studies. The motivation to save for dependents may differ by sexual orientation among men due to (1) differing expectations that a man will or won’t have children in the future, and (2) differing normative pressure to have or not have children in the future. This difference in pension savings motives informs the context of emerging findings of sexual orientation differences in enrollment in pension schemes in the UK and elsewhere, the need for inclusive financial education about retirement savings, and increasingly individualized welfare in Western states such as the UK.