The real costs of family planning for same-sex couples, part 2


John Schneider

John Schneider

Blog author John Schneider

John Schneider has over 20 years of experience writing about money, with a focus on the queer community, being featured in Yahoo Finance, Business Insider, Time and more. With his husband and business partner, he co-owns Debt Free Guys and co-hosts the Queer Money podcast, a podcast about the financial nuances of the queer community.

Published March 3, 2017|6 min read

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In Part 1 of this series, we discussed the potentially staggering costs of having children for same-sex sex couples. Depending on the approach—adoption, biological (possibly including a surrogate)—that little bundle of love could cost up to $150,000. With the added $245,000 needed to raise a child to the age of 18 – including $16,000 in the first year alone – you may need to shell out nearly half a million dollars all-in. And that doesn’t even cover college! No small feat when even the $2,500 required for foster care adoption may be a challenge for some couples.Saving and budgeting for your new family is a great place to start, with direct deposits and automated electronic fund transfers helping you put your savings on autopilot. But just forcing yourself to save may not be enough. However, with the right approach and and some clever money moves, the costs are manageable.

Tax advantages

For taxpayers who itemize on their Schedule A, the IRS does provide deductions for out of pocket medical expenses. Such expenses can include out of pocket doctor visits, preventive care tests, ultrasounds, birthing classes and more.Also consider looking into a health savings account, or HSA, for qualified expenses. While fees associated with the adoption process don’t qualify, other fees, like those associated with IVF, are eligible, giving you a tax-advantaged option for paying for these expenses.

There are tax benefits for having children, especially if you’re a first-time parent. Such benefits include the Earned Income Tax Credit, which may give those who qualify a tax credit over $3,000 for your first child and even more of a tax credit for additional children. For those who qualify, the Child Tax Credit may reduce your taxes by up to $1,000 per year per child. The Child and Dependent Care Credit can provide as much as $3,000 in tax credits annually per child to cover costs such as daycare.

Pay off debt

Having children is expensive and taking care of children through to adulthood is even more expensive. Therefore, it’s important to manage both sides of your personal balance sheet. The less debt you have before you have a child the better. This will be particularly handy if you pursue obtaining a personal loan to help fund the growth of your family.

Raise money creatively

Since conception and adoption costs are so high, many same-sex couples may be tempted to obtain a loan from a bank or credit union, using their house or other collateral to help provide the necessary fund, or even turn to credit cards.While these are viable options, they can quickly put you into debt if you’re not able to pay them off. Instead, you may be better served to think creatively about raising money.

A newer option available queer couples to grow their families is crowdfunding their adoption or fertility procedures. Through crowdfunding sites such as GoFundMe, queer couples can use crowdfunding to help mitigate their out of pocket expenses. It’s important to make yourself aware of any hidden fees for you and your donors for using crowdfunding site services and the tax consequences for donating and receiving donations.Other funding options include applying for adoption grants through services such as the National Adoption Foundation and fertility treatment grants. Such financial support can make growing their families for queer couples more viable, but obtaining such grants can be hard and complex.Tax-deductions for donations typically only apply to donations made to legally registered non-profit organizations and charities. Donations made to help grown your family may not qualify for tax-deductions. Likewise, most crowdfunding donations would fall under "personal gifts" and wouldn’t qualify as taxable income. In both cases, though, it’s important to talk with a tax professional as each case is different and different state laws may affect you and your donors.

Clean your credit report

If you try to obtain a personal loan, you’ll want the best credit score possible. The lower your credit score, the lower the interest on your personal loan.

To save you money over the life of your loan, clean your credit report to improve your credit score. Make sure the information on your credit report is accurate. Dispute any inaccurate charges. Lower your credit utilization, meaning use less than 50 percent of your available credit. Pay your bills on time and, finally, limit the number of loans for which you apply.

Health insurance plans

Some insurance plans provide coverage for family planning, including adoption and fertility costs. For example, Anthem Blue Cross of California has been cited as covering up to 90% of IVF costs after the deductible is met. If you use an agency to arrange an option or surrogacy, the agency may cover some costs in addition to or instead of providing coverage to the birth mother. Though the payout is often limited, it helps to get money from wherever you can. If you’re in the market for a new plan, our health insurance resource center can help you find one that fits your needs.

529 accounts

It’s never too early to start thinking about college. A 529 savings account is a savings account similar to a 401(k), but the money can only be used on qualified educational expenses. There are no taxes on the gains as long as they’re used for educational purposes, which means there are benefits to using a standard savings or investment account. Some states even allow you to deduct contributions on your tax return. For a full rundown on 529 plans, see our guide here.

Maternity/paternity leave

The Family Medical Leave Act (FMLA) requires employers to provide a minimum of 12 weeks of unpaid maternity leave. Some companies are more liberal with their maternity and paternity leave policies, but it varies wildly. Many new parents use a combination of paid vacation, sick days and personal days in conjunction with unpaid leave, so it helps to save up as much paid leave as you can before having a child.

Since parental leave is generally unpaid it won’t help you save money directly, but it may help reduce initial costs such as initial daycare costs.

Life insurance

If you have a partner and haven’t purchased life insurance, don’t wait any longer if you decide to have children. For at least the next 18 years, you’ll have dependents to protect, and the older you are when you start a policy the more expensive it becomes. Premiums can rise by 8% to 10% for each year you wait. Check out our Learning Center for everything you need to know.


While you’re being a responsible adult and buying life insurance, update your beneficiaries. It’s not uncommon for people to forget to update beneficiaries as their relationships change. However, beneficiary designations supersede wills, which means you could have an ex-partner lay claim to your assets if you pass away. When you have children—regardless of what your will says—make sure your beneficiaries are up to date on any insurance policies and investments.There’s a lot to plan for when planning to have children, especially for queer people and couples. The best thing you can do is thoroughly research all your options and expenses, and budget accordingly. As we all learned from G.I. Joe, knowing is half the battle.