LGBTQIA+ Financial Guide to Becoming a Parent

ByDeb Gordon
Edited byRae Osborn

Updated: May 12, 2024

ByDeb Gordon
Edited byRae Osborn

Updated: May 12, 2024

Advertising & Editorial Disclosure

While the U.S. still has a way to go to achieve LGBTQIA+ equality, some significant strides have been made, particularly when it comes to LGBTQIA+ families. In 2015, the U.S. Supreme Court ruled that same-sex couples have the right to be legally married. According to Census Bureau data, by 2021, there were roughly 710,000 married same-sex couples in the U.S. A pivotal 2020 Supreme Court decision also expanded employment anti-discrimination statutes to include LGBTQIA+ people.

While starting a family can be complicated and expensive for any parent, it's especially true for LGBTQIA+ people. The progress made in LGBTQIA+ civil rights, along with advancements in medical and reproductive health technology, have given LGBTQIA+ people who want to add children to their lives more options than ever. According to a U.S. Census Bureau analysis of Current Population Survey (CPS) data, 15% of the 1.1 million same-sex couples in the United States in 2019 had at least one child under 18 in their household, compared with 37.8% of opposite-sex couples.

Cost of Becoming a Parent for LGBTQIA+ People

Today, LGBTQIA+ people have many options for forming families, but costs can be a barrier whether you choose adoption, surrogacy or in vitro fertilization. Legal fees, the cost of harvesting donor sperm or eggs, out-of-pocket medical expenses and surrogacy or adoption agency fees make it hard for some LGBTQIA+ people to become parents.

While costs can vary widely depending on where you live and what method you choose for building your family, knowing the cost of becoming a parent is an essential first step in deciding which route to take.

Adoption

Adoption is the process of assuming legal rights and responsibilities for non-biological children. There are several different types of adoption, each with different processes, requirements, emotional impacts and costs.

Public Agency Adoption: Virtually Free of Cost

Adopting a child from the public child welfare system typically incurs minimal to no costs, with eligibility for state or federal assistance covering both ongoing financial support and Medicaid for the adopted child. The Federal Adoption Assistance and Child Welfare Act of 1980 facilitates these adoptions by offering financial and medical assistance to reduce barriers and support adoptive families' needs.

Eligible families may receive a one-time reimbursement of up to $2,000 for adoption-related expenses, such as court and attorney fees, with potential tax deductions for expenses exceeding this limit. To qualify for federal adoption assistance, a child must meet specific criteria, including being unable to return to their biological parents and having special needs that make adoption without assistance challenging.

Resources like Child Welfare Information Gateway’s Adoption and Guardianship Assistance by State provide detailed information on state-specific adoption assistance programs, helping families understand eligibility, benefits and application processes.

Private Agency Adoption: $30,000 to $60,000

Adoption through private agencies is more costly than public child welfare system adoptions. The average total cost for adoption via an adoption agency can reach up to around $43,000 before claiming the adoption tax credit. These fees cover home studies, court and legal expenses, counseling for birth parents, medical and legal costs for the birth parent, adoptive parent training, social work services for child-family matching, interim child care and post-placement supervision until the adoption is finalized.

Finalizing the adoption in a U.S. court is a requirement for all domestic adoptions and some intercountry adoptions, with the average documentation fee being $600. Legal fees for adoptive parents can reach up to $4,500, depending on the state and the complexity of terminating parental rights. Whether these expenses are included in the agency’s overall fee varies by state and agency.

Independent Adoption: $25,000 to $45,000

Independent adoption, conducted outside the public child welfare system, typically involves legal representation for both prospective adoptive parents and expectant parents. Costs for this adoption route can vary greatly depending on the complexity of the legal procedures and the services of legal consultants, attorneys or facilitators. The total average cost can reach up to $38,000 before claiming the adoption tax credit. These fees often cover a home study, the birth mother’s medical expenses and legal and court fees for both adoptive and birth parents.

Some nonprofit organizations, such as Pact: An Adoption Alliance and The Cradle’s Ardythe and Gale Sayers Center for African American Adoption, offer financial assistance to adoptive families. These organizations focus on matching newborns with families sharing the same racial and cultural background or those prioritizing the adoption of African-American children or children of color.

Intercountry Adoption: $36,000 to $50,000

Intercountry adoption involves fees that can significantly vary by country. These adoptions often incur higher costs than domestic adoptions due to the necessity of foreign travel, immigration processing, court expenses, adoption education and required documentation. For example, the total average cost for adoptions to the U.S. from China can reach up to $36,000, $35,000 from Ukraine and $48,000 from South Korea. These costs are before claiming the adoption tax credit.

The type of organization overseeing the adoption — be it a government entity, private agency, orphanage, nonprofit, attorney, facilitator or a combination thereof — also influences the total costs. While some intercountry adoptions are completed in the child's home country, others require finalization in the United States, especially if a family's state does not recognize the foreign adoption decree. Many parents choose to finalize the adoption in a U.S. court to ensure full legal protections, potentially increasing the overall cost.

Foster to Adoption: $1,000 to $5,000

Adopting children from foster care involves either adopting children whose parents' parental rights have been terminated or first fostering a child who is a ward of the state. Either approach is much less costly because fees are low or nonexistent. The average total costs can reach up to $2,900, covering home study, document preparation, attorney fees and travel expenses.

Foster-system adoptions depend on state laws and policies. Even in the states that prohibit discrimination based on sexual orientation or identity, LGBTQIA+ adoptive parents may encounter heterosexism that could make adoption more challenging than it should be.

Second-Parent Adoption: $2,000 to $3,000

In some jurisdictions, two partners can simultaneously petition to adopt a child, but others prohibit joint adoptions for unmarried or same-sex couples. In such cases, one parent adopts the child and the other completes a second-parent adoption. The adoption costs for this approach range from $2,000 to $3,000.

Even if you’re married, and both are named on the child’s birth certificate, it’s safer to go through second-parent adoption. A birth certificate is “evidence, but not proof of heritage,” Joyce Kauffman says, leaving parentage open to challenge in some states. Adoption decrees, though, are respected by all jurisdictions.

Second-parent adoption is “not rocket science,” according to Kauffman and some people may feel they can do it on their own. But it helps if you know what you’re doing. Legal fees vary and typically fall in the $1,000 to $2,000 range.

Not all states allow unmarried couples to do second-parent adoptions, but you can still take steps to prove you are a family, including signing a co-parenting or custody agreement and demonstrating the second parent’s involvement as a parent.

Surrogacy: $60,000 to $150,000

Surrogacy is a process in which a woman carries and delivers a baby for another person or couple. There are two types of surrogacy: gestational and traditional.

Gestational surrogacy occurs when a fertilized egg from a donor other than the surrogate is implanted through in vitro fertilization (IVF). The egg and the sperm may come from donors or from a biological parent.

A traditional surrogate donates her egg to be fertilized by sperm from a donor or the biological father and implanted using intrauterine insemination (IUI).

Typical surrogacy costs between $60,000 and $150,000, which is prohibitive for most people. Attorney Joyce Kauffman, who specializes in family law, noted, “I’ve certainly known people who have modest incomes who’ve literally remortgaged their homes in order to be able to have a child.”

1
Surrogate Compensation: $50,000 to $90,000

Unless a family member or close friend is willing to be a surrogate or egg donor without compensation, you can expect to pay the surrogate at least $50,000 more if the pregnancy results in twins or requires cesarean delivery.

2
Surrogate Expenses: $25,000 and up

You might pay for your surrogate’s living expenses and lost wages, which will vary. The surrogate’s health insurance costs typically cost between $10,000 and 25,000, or more in monthly premiums, copayments, co-insurance and deductibles. Out-of-pocket costs may be high because many providers and aspects of fertility treatment are not fully covered, if at all, by insurers.

3
Screenings: $1,500

Between mental health screening for parents and surrogates and background checks, you can expect to pay approximately $1,500. Additional costs for medical screenings will vary depending on what the IVF clinic recommends.

4
Legal Fees: $5,000 to $12,000

In surrogacy arrangements, you need contracts between all parties: the surrogate, the agency and the egg donor. Legal fees will vary, but drafting and reviewing contracts might cost $2,500 and $1,000. To legally establish parentage for both parents, you need a court judgment. This process can cost between $4,000 and $7,000.

5
Miscellaneous Costs

Psychological support for intended parents and surrogates, insurance verification, term life insurance and travel costs are some of the other expenses you may encounter.

In Vitro Fertilization: $23,000 to $50,000

According to the Mayo Clinic, in vitro fertilization (IVF) is considered the most effective form of assisted reproductive technology (ART) and can have a 50% or better success rate. The process entails retrieving eggs from a woman’s ovaries, fertilizing the egg in a lab and transferring the fertilized egg into a woman’s uterus.

IVF costs vary by provider, location and insurance coverage. FertilityIQ data indicates that a single IVF cycle costs approximately $23,474, with variations based on the location and included services. On average, patients undergo 2.3 to 2.7 IVF cycles, leading to an average expenditure of about $50,000 on treatment. Annually, total costs typically rise by 10% to 15%, with 5% of this increase attributed to more patients opting for PGS genetic testing.

Artificial Insemination: $200 to $2,000

Artificial insemination is the process of delivering sperm directly to a woman’s cervix or uterus, with costs ranging from $200 to $2,000. There are two artificial insemination approaches:

1
Intrauterine Insemination (IUI)

This procedure is performed at a medical facility and involves inserting sperm into the uterine cavity. Success rates range from 5% to 20% in one cycle, depending on the cause of infertility. IUI costs range from $300 to $1,000 per cycle plus the cost of donor sperm, if applicable ($700 to $1,000 per vial). Health insurance may cover some of these costs.

2
Intracervical Insemination (ICI)

Sometimes called at-home insemination (though it can be performed at a medical facility) or intravaginal insemination, ICI is a more straightforward process than IUI. Success rates range from 5% to 30% in one cycle. ICI costs less — approximately $200 to $350 per cycle, plus any donor sperm costs.

Does Health Insurance Pay for Assisted Reproductive Technology?

Whether your insurance covers Assisted Reproductive Technology (ART) depends on where you live and your health plan. As of September 2023, 21 states, along with DC, have enacted fertility insurance coverage laws. Among these, 15 states mandate coverage for IVF and 17 states provide coverage for fertility preservation in cases of iatrogenic (medically-induced) infertility. These rules apply to individual and small-group insurance plans and some employer plans. Self-insured employers who pay medical claims themselves and use an insurer to administer benefits are typically not subject to them.

ART coverage is typically for people diagnosed with infertility, which does not apply for most same-sex couples or LGBTQIA+ singles. Many policies discriminate against LGBTQIA+ people. For example, Arkansas requires couples to prove two years of unexplained fertility and a husband's sperm must fertilize the patient's egg in order to be covered by insurance. Conversely, New Jersey specifies that a female without a male partner can access fertility treatment and covers IVF for a surrogate mother.

Employers can offer more generous benefits if they choose, but most don’t. According to a FertilityIQ study, 56% of patients had no insurance coverage for IVF. Costs associated with egg or sperm donors and surrogate compensation would not be covered by health insurance, but fertility drugs, specialized testing and artificial insemination could be.

The Affordable Care Act established that maternity benefits are essential. Prenatal care, labor and delivery and postpartum care will be covered regardless of who is pregnant or how they became pregnant. Preventive prenatal visits should be free, but copayments, deductibles and co-insurance will apply to some visits, tests and delivery.

There’s no way around some of these expenses, but you might be able to save money with these strategies:

  • Find a known egg or sperm donor who doesn’t require compensation.
  • Try at-home insemination; if it works, you’ll save money on your portion of the procedure costs at a facility.
  • Find a surrogate mother who has her own health insurance; you’ll still pay her out-of-pocket costs, but you’ll save on premiums.

How State Laws Impact Cost of ART

Laws covering ART, surrogacy, adoption and parentage are set at the state level, and every state is different. Some federal health insurance requirements apply nationwide, but states decide on many specific health insurance rules.

In states that don’t require ART benefits, LGBTQIA+ people must pay the full cost of fertility treatment or surrogacy. The 11 states where 20% of the LGBTQIA+ population lives allow state-licensed child welfare agencies to refuse placement with LGBTQIA+ people based on religious objections. In these states, adoption may be difficult, if not impossible.

In addition to laws that prohibit discrimination more generally, laws that determine who a parent is — usually found in state paternity statutes — are particularly important in LGBTQIA+ family issues.

Some states have made it easier for same-sex couples to establish parentage. For example, in Massachusetts, a lesbian couple can complete an acknowledgment of parentage form at the hospital, be on the birth certificate and be considered legal parents.

Some States Still Lag in LGBTQIA+ Parental Rights

There are no guarantees that other states will recognize parentage without legal adoption. Some states are challenging non-biological parents’ rights even if they’re on the birth certificate. The most secure legal protection is adoption. “Once you do that adoption,” Kauffman said, “the parentage cannot be challenged.”

Second-parent adoptions add legal costs but are recognized nationwide. But the Movement Advancement Projects reports that only 44% of the LGBTQIA+ population lives in states where they can petition for second-parent status. Alternative approaches like co-parenting or custody agreements also require an attorney.

Kauffman urges her clients to create health care proxies, powers of attorneys and wills. "This is yet another expense gay people have," she said. "Straight people should have these things, too. But for gay people, it's essential to make sure that the people you want to be making these decisions are the ones who get to make (them) and who can visit you in the hospital."

6 Tips to Financially Prepare for Having a Child

Forming a family doesn’t need to break the bank. These six strategies can help you manage the costs of having children

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    Get the Financial Help to Which You’re Entitled

    Financial assistance from your state may be available; criteria and amounts vary. If you're adopting, you may qualify for the $14,080 federal adoption tax credit per child and additional federal or state tax credits and ongoing financial help if you adopt a child with special needs. Some pharmaceutical companies offer financial assistance for their fertility drugs.

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    Use Your Employer Benefits

    Your employer may offer fertility, adoption or surrogacy benefits like financial support, counseling and paid employee leave. The Dave Thomas Foundation for Adoption recognizes the 100 Best Adoption-Friendly Workplaces based on factors including financial reimbursement and paid leave.

    businessOwner icon

    Hire a Financial Coach

    Adoption financial coaches can help you navigate funding intricacies. Financial advisors or planners can also help you plan, save and manage your family formation expenses.

    loanPro icon

    Explore Financing Options

    Fertility financing options exist in the form of loans, low- or no-interest credit, payment plans and flat-fee arrangements. Resources are also available to offset surrogacy costs, from loans and grants to credit and donations from individuals, nonprofits or drug companies. Circle Surrogacy offers a fixed-cost program that includes the professional, gestational carrier, egg donation and insurance fees. While still costly, the program reduces surprise and sets a limit.

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    Make a Plan

    Once your baby is on the way (if not before), focus on setting up your family’s financial life. Raising a child is estimated to cost more than $200,000, but implementing personal finance strategies can help. Set financial goals, and make a budget and plan for staying on track. Pay down debt and build up any emergency savings you can. It’s even more critical to have an estate plan to protect your growing family.

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    Understand Military and Veteran Benefits

    If you’re a veteran, you may be entitled to adoption benefits, including a one-time reimbursement of up to $2,000, for adoption costs and disability benefits if your child qualifies. You may also be eligible for free fertility products from Heart for Heroes if you're on active duty or a veteran without insurance coverage for IVF medication.

Financial Assistance for LGBTQIA+ Parenthood

Starting a family can be especially costly for LGBTQIA+ parents, who incur additional legal and medical expenses. Organizations that provide financial assistance to help LGBTQIA+ families include:

  • AGC Scholarship Foundation provides financial support for U.S. citizens struggling with infertility.
  • BabyQuest Foundation provides financial assistance for couples or individuals under 40 struggling to afford fertility treatments, including IUI, IVF, egg donation and surrogacy.
  • Family Equality lists LGBTQIA+-friendly organizations that provide financial help to residents of specific local areas or regions or with specific needs.
  • Family Formation Charitable Trust, founded by the Academy of Adoption and Assisted Reproduction Attorneys, provides financial assistance to individuals and organizations seeking to create families through adoption and assisted reproductive technology.
  • Gift of Adoption Fund provides up to $10,000 in grants to offset adoption costs. Awards are given without regard to sexual orientation.
  • HelpUsAdopt.org provides grants to all types of families, including LGBTQIA+ families, to help pay for lawyers and agencies in all kinds of adoptions.
  • Human Rights Campaign (HRC) provides information on how to access a range of financial help.
  • Journey to Parenthood provides up to $10,000 grants to couples and individuals to cover IVF, IUI, egg donation, surrogacy and adoption.
  • Men Having Babies offers the Gay Parenting Assistance Program that facilitates more than $1 million in cash grants each year, discounts and donated services to ease financial burdens of surrogacy.
  • National Adoption Foundation Financial Programs offers $500 to $4,000 grants to help prospective parents offset adoption expenses and is open to all legal adoptions.
  • Resolve: The National Infertility Association supports family-building journeys, including for LGBTQIA+ families and provides information about financing and cost management options.

Expert Advice on LGBTQIA+ Family Planning

Joyce Kauffman is an attorney with Kauffman Law & Mediation in Massachusetts. She specializes in adoption, guardianship, reproductive technology, divorce and mediation, focusing on issues impacting the LGBTQIA+ community. Kauffman has consistently been recognized as a top lawyer by Boston Magazine, Best Lawyers in America and Massachusetts Lawyers Weekly, who named her "Lawyer of the Year" in 2009. She is president of the GLAD board of directors, a member of the National Center for Lesbian Rights' National Family Law Advisory Council and a member of the Family Equality Emeritus Board.

Kauffman earned her J.D. from Northeastern University School of Law, an M.Ed. in counseling psychology from Lesley University and a B.S. in child development from the University of Massachusetts at Amherst. She has written for the New York Times, the Boston Globe and Bay Windows on the importance of securing legal protections for LGBT families.

In the following sections, Joyce Kauffman discusses key aspects of family planning for LGBTQIA+ families, offering insights into the necessary preparations and legal protections that can help secure their family's future.

  1. What considerations do LGBTQIA+ families need to focus on when planning to start a family?
  2. What are some barriers that LGBTQIA+ families uniquely face?
  3. What can LGBTQ families do to protect themselves?
Joyce Kauffman
Joyce Kauffman

Additional Resources

We've compiled a list of organizations dedicated to advocacy, legal support and education to support individuals and families within the LGBTQIA+ community in navigating adoption and family rights.

About Deb Gordon


Deb Gordon headshot

Deb Gordon is author of “The Health Care Consumer’s Manifesto (Praeger 2020),” a book about shopping for health care based on consumer research she conducted as a senior fellow in the Harvard Kennedy School’s Mossavar-Rahmani Center for Business and Government between 2017 and 2019. Her research and writing have been published in JAMA Network Open, the Harvard Business Review blog, USA Today, RealClear Politics, TheHill and Managed Care Magazine. Deb previously held health care executive roles in health insurance and health care technology services. Deb is an Aspen Institute Health Innovators Fellow and an Eisenhower Fellow, for which she traveled to Australia, New Zealand and Singapore to explore the role of consumers in high-performing health systems. She was a 2011 Boston Business Journal 40-under-40 honoree and a volunteer in MIT’s Delta V start-up accelerator, the Fierce Healthcare Innovation Awards and in various mentorship programs. She earned a B.A. in bioethics from Brown University and an MBA with distinction from Harvard Business School.


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