Financial Advisors: Attracting and Working With LGBTQ Couples. As a Financial Advisor Coach working with advisors since 2004, I have noticed more and more advisors who want to work with and attract LGBTQ clients and couples.
Nowadays, the LGBTQ community has more support from the international community than ever before; however, despite the many advances in equality and anti-discrimination practices, members of the LGBTQ community still face many challenges unique to their situation.
If you’re looking to work with LGBTQ couples and help them with their unique financial situations, you’re going to need to market yourself as a financial advisor who makes members of the LGBTQ community feel safe. What’s more, you’re going to need to adjust how you work to better serve this demographic.
To learn more about how you can attract and work with LGBTQ couples, read on below.
What Struggles Do LGBTQ Couples Face?
In recent years, around one in three LGBTQ Americans report to have faced discrimination in their work and personal lives.
It’s interesting to note that the discrimination LGBTQ individuals face harms not only their psychological well-being but also their economic well-being. LGBTQ individuals report that their economic security is at risk due to how discrimination adversely affects their ability to be hired, to retain employment, and to be promoted.
How Can You Market Yourself to LGBTQ Couples?
We’ve established that LGBTQ couples are negatively affected by discrimination and a lack of inclusivity practices. With that said, the way you market and advertise your services should keep the struggles of LGBTQ individuals in mind. Below are a few tips.
1.Know the Terminology
You may have hesitated up until this point to establish personal connections when interacting with potential LGBTQ clients out of fear of using the wrong terms or saying the wrong things. This fear is understandable.
Luckily, there are many resources online that can help you understand the terminology LGBTQ individuals use to identify themselves. What’s more, there’s no harm in asking your clients directly which pronouns they prefer. Taking time to ask for these pronouns shows your willingness to understand and respect their gender identity.
Before creating marketing materials tailored to the LGBTQ community or before reaching out to LGBTQ couples, be sure you’re up-to-date with the latest terms and significant events relevant to the LGBTQ community.
2.Practice Inclusive Marketing
Think about how you present your brand through your website. Ponder on the following questions:
- Who do prospects see when they view your website?
- Do prospects see people on your website that look like them?
- Is the language on your website inclusive of the LGBTQ community?
- Can the LGBTQ community identify with examples on your website?
The best way to make sure LGBTQ clients know that you have an inclusive financial advisory firm is to show them. Even small actions like adding your pronouns to the end of your name on a Zoom meeting and on your LinkedIn profile, or asking for pronouns in a questionnaire can go a long way.
What Financial Issues Do Most LGBTQ Couples Face?
The fact remains that there’s a pay gap and those who identify as LGBTQ fall on the wrong side of it.
1.Earning Their Worth
As of 2017, a survey found that gay men, on average, earn over $26,000 less than heterosexual men annually. Likewise, lesbian women earn nearly $6,000 less than heterosexual women.
The issue of the pay gap is worsened by the high costs of living in areas that tend to be more welcoming to LGBTQ individuals, such as San Francisco and New York.
Recent surveys show that – in comparison to the general population – LGBTQ individuals have more trouble saving money and claim to have bad financial habits they wish to break.
The survey speculates that the LGBTQ population may have a bit more trouble with consumerism because they’ve spent many years feeling devalued themselves. It is said that they may compensate by showing people that they have nice things or live a nice life.
It’s also important to note that LGBTQ couples who don’t have children are able to save more than traditional couples.
3.Dealing With Housing and Credit Discrimination
Either consciously or unconsciously, potential landlords or creditors who pull the credit reports of LGBTQ individuals and see that they formerly went by a different name or recently transitioned from a different gender might deny their request for an apartment or a mortgage.
Unfortunately, bias and discrimination are rampant, as a 2018 study found that same-sex couples applying for mortgages were over 70% more likely to be denied when compared to heterosexual couples with similar financial backgrounds. Sadly, many states in the US lack sufficient legal protections for this kind of discrimination.
What Tips Can You Apply When Working With LGBTQ Couples?
It’s crucial that you create a safe space for all of your clients. Creating a safe space will let your clients communicate their life stories to you.
1.Take Your Clients’ Needs Seriously
It’s important that you allow LGBTQ couples to talk about what it was like growing up, how their families talked about money, and whom they financially support – if they choose to disclose these details and if these details are relevant to your services.
The LGBTQ community may assign great importance to these details, especially if they are estranged from their biological family.
Members of the LGBTQ community get reminded and have to deal with the fact that they are different on a daily basis. So, instead of approaching your clients’ relationship as if they were no different from your straight couple clients, be sure to appreciate the uniqueness of their situation and highlight how their financial planning is different and tailor-made.
2.Plan With Appreciation
You’re going to want to create a safe space for your clients to be their authentic selves. Here are a few ways you may choose to do this:
- Acknowledge the obstacles that your LGBTQ clients face that lead to job insecurity and help them make decisions about staying in unwelcoming companies or careers.
- Consider whether to build investment portfolios with your client that reflect their values by including LGBTQ-friendly mutual funds and ETFs such as Vanguard’s Social Index Fund (VFTAX).
- When it comes to LGBTQ couples with children, there are many methods of creating a family. Your clients may choose adoption, fostering, or surrogacy. Each of these methods comes with costs that vary widely. Fostering may cost next to nothing while surrogacy may cost upwards of $100,000.
3.Understand the Nuances of Planning to Have a Family
It’s important that you take time to understand all the associated costs involved with building a family for LGBTQ couples. This way, you can help your clients make effective plans and sound decisions more easily.
Many LGBTQ people live in high-cost urban areas. In addition to this – as mentioned earlier – many LGBTQ individuals consider themselves spenders when compared to their heterosexual counterparts.
4.Don’t Ignore the Significance of a Spending Plan
Since many LGBTQ individuals tend to spend a lot, you’re going to need to be prepared to spend more time with your clients discussing their cash flow and taking note of what’s coming in and what’s going out.
You may consider creating spending plans that will help your LGBTQ clients plan for what they want and need now, in addition to what they want and need in the future. Note that LGBTQ clients may have big-ticket expenses that heterosexual clients may not need, such as gender confirmation surgery.
Even if same-sex marriage may be allowed wherever your clients live, many LGBTQ couples may choose not to marry. Some couples like the way things are, while others are actively opposed to marriage as they believe getting married conforms to societal norms that they do not wish to follow.
5.Don’t Assume They Want to Marry
If you wish, you may highlight the many financial benefits that come with marriage; however, after sufficiently educating your clients on the pros and cons, it’s important that you respect and support whatever decision your clients arrive at.
If your LGBTQ clients choose not to marry, you’ll need to understand – and help your clients understand – how to navigate the financial world of non-married couples who share bank accounts and split expenses, especially when there is a big difference in income; also, you’ll need to be prepared to handle multiple tax returns and estate and insurance planning.
Finally, don’t make any assumptions about your LGBTQ clients simply because you know they are LGBTQ. Although there are many experiences that are common to each member of the LGBTQ community, each person is different and one client may be vastly different from another.
6.Don’t Assume You Know the Person’s Experiences
When in doubt, it’s better to ask your clients for clarification on anything you don’t understand instead of making assumptions.
As we’ve mentioned, members of the LGBTQ community face many challenges – including financial ones. While recent changes, such as the Supreme Court’s ruling that grants non-discrimination protections to LGBTQ individuals, have greatly benefited the LGBTQ community, there is still a long way to go.
You’ve already made the first step toward a more inclusive and caring society by choosing to actively work with and learn about the LGBTQ community. There are still key areas of life that LGBTQ couples may struggle with, such as credit, housing, and employment. With the information you’ve learned today, you’re now able to ease the financial burden that LGBTQ couples face on a daily basis.
To learn more about how you can grow your financial advisory firm and hone your skills as a successful financial advisor, check out the other articles on my website or contact me today.