Financial advisors can find new opportunities for helping individuals and couples with their financial planning in the LGBT community, says LIMRA, a global research and educational organization for the financial industry.
Members of the lesbian, gay, bisexual and transgender community have seen positive changes for themselves in recent years, but these changes may give rise to some new questions about their financial lives.
Advisors who can zero in on this niche market can increase their opportunities for growing their practices, says Dr. Nilufer R. Ahmed, a senior research director for LIMRA and author of the research on the LGBT market recently released by LIMRA entitled “Exploring the Market Potential of the LGBT Population.”
“Gauging market potential presents a challenge because the only way to accurately estimate its size is for individuals to identify themselves as LGBT,” says Mark Morris, senior public relations consultant for LIMRA. The market size has been estimated at somewhere between nine million and 18 million American adults, he says.
More gays and lesbians are getting married or considering it now that same-sex marriages are legal nationwide, which brings up financial questions they may not have considered before. Additionally, 16 percent of same sex couples have children and half of millennial LGBT couples say they want children eventually, says Morris.
“It is hard enough for people in general to keep up with financial changes. When you add to that this immediate change [of the Supreme Court ruling last year allowing same-sex marriages] you add even more questions,” says Ahmed. “Is it better to get married? Is it better to file a joint tax return? If they have children, they will need more financial products such as education funds.
“Financial advisors can help LGBT couples sort through these things that might be new to them,” she adds.
Same-sex couples are more likely to have both partners working full time than heterosexual couples. On average, opposite-sex couples have a combined income of $104,226, compared to same-sex couples who average $117,768, according to the U.S. Census Bureau.
Advisors can set themselves up as experts for this community by becoming familiar with LGBT issues and then making themselves known as being supporters of the LGBT community, Ahmed says.
“Go to LGBT events. Partner with LGBT organizations, such as Pride Planners and connect with estate lawyers and CPAs who have experience in the LGBT community,” she adds. Pride Planners (prideplanners.com) is an educational, information and networking resource for financial planners serving the LGBT community.