Learn how to ask the right questions – InsuranceNewsNet

While the fundamentals of a financial plan remain similar for all clients, there are important nuances to consider when working with members of the LGBTQ community. As a wealth management advisor who identifies as bisexual and polyamorous, I specialize in working with members of the LGBTQ community and know firsthand that using a turnkey approach to help our community is not effective. However, staying informed about the unique issues LGBTQ+ people face and learning how to ask the right questions can help have a huge impact on your clients’ lives, helping them secure their financial and family future.

Based on my experience as a counselor and my experiences in the community, I have compiled a list of considerations that may specifically relate to your LGBTQ clients. Although the list is not exhaustive, it can serve as a basis for your discussion, allowing you to become a powerful resource and ally on their behalf.

Many advisors recommend that clients set up an emergency fund containing three to six months’ salary. This amount is usually enough to cover most unexpected expenses – including medical bills and car repairs – or to serve as a financial lifeline if they suddenly find themselves unemployed. However, this may not be enough for members of the LGBTQ community who may still face discrimination based on sexual orientation or gender issues.

Extended protections

In June 2020, the United States Supreme Court extended Civil Rights Act protections to gay and transgender employees, making it illegal to fire an employee for being gay or transgender. However, the ruling only applies to employers with 15 or more employees, meaning smaller employers can still fire someone because of their sexual orientation or gender issues, unless they are prevented from doing so by the laws of their State. Currently, only 21 states have laws in place to fully protect members of the LGBTQ community from employment discrimination. With that in mind, a safe recommendation for members of the LGBTQ community is to create an emergency fund that can last nine to 12 months. This is a similar recommendation for anyone who is self-employed.

Asking clients to perform an annual budget audit can help determine how they are actually spending their money. This budget audit is beneficial not only for members of the LGBTQ community, but for all individuals during the financial planning process. It’s often an eye-opening experience for customers to realize that their perceived spending habits differ greatly from reality. However, performing a budget audit allows clients to make more intentional decisions about how they choose to spend and provides the clarity needed to help clients focus on the things that matter most to them.

When speaking with LGBTQ clients about planning for their future, it is important to remember that many life milestones can be significantly more costly for members of this community.

When talking with LGBTQ clients about planning for their future, it’s important to remember that many life milestones can be significantly more costly for members of this community – perhaps most especially when it comes to family planning. In vitro fertilization, surrogacy and adoption costs can add up quickly, but many clients also fail to consider potential future legal costs they may face.

For example, when couples of unmarried women start a family, one of them is often the biological parent, while their partner is not automatically considered the other legal parent of the child. In the event of the death of the biological parent, depending on state law, the surviving parent may not automatically become the guardian of the child if they have not legally adopted that child.

There are also huge costs to consider for transgender people looking to transition. Many insurance companies do not cover necessary surgery and ongoing hormone replacement therapy costs, so clients may need to plan for these out-of-pocket expenses.

Protect your finances with insurance

Insurance is an important part of any comprehensive financial plan. Although most clients hold policies to protect their material assets, many have yet to consider protecting themselves and their immediate family members financially should they become incapacitated and unable to work, or if they died unexpectedly. The inclusion of disability and life insurance policies can help provide customers with the peace of mind of knowing that they and their loved ones are protected should the worst happen.

When working with LGBTQ couples, it is especially important that those who have children from previous relationships or adopted children explicitly name the beneficiaries of their insurance policy. This will eliminate any possible confusion about who should receive benefits when a claim is made.

retirement planning

Whether you’re working with individuals or a couple, it’s essential to discuss each client’s unique vision for retirement to better help them create a plan to grow their savings and investments. As the laws evolve, it can also be helpful to understand the rules for claiming Social Security survivor benefits and retirement account distributions when counseling unmarried LGBTQ couples in long-term relationships. term.

Also consider that people who identify as female in the LGBTQ community may be demographically disadvantaged and face additional savings challenges. Historically speaking, we know that women live longer than men, and throughout their careers, women also earn less than men for similar work. To ensure a financially secure retirement, women and female couples often need to plan to save at a higher rate than male or heterosexual couples.

Development of a real estate project


Estate plans are essential to any financial plan, allowing clients to ensure that their wishes will be respected and that their families will be taken care of in the event of their death. Specific elements of these plans are critically important to LGBTQ couples, especially if they are not legally married.

I encourage my unmarried couple clients to create a Lasting Power of Attorney. This allows them to ensure that their partners are able to make medical decisions for them in the event of incapacity. Without this document, their partners may not have the legal right to do so in an emergency. Again, it is also important for unmarried couples with children to consider the rights of the non-biological parent and to determine whether legal adoption is necessary to preserve parental rights.

While advising members of the LGBTQ community may include unique considerations, as with any client, the earlier financial planning begins, the better! By educating yourself about these issues and sharing your knowledge, you can help your LGBTQ clients lay the foundation for a strong financial future, ensuring that these individuals can support themselves and their loved ones for years to come. coming.

Sarah A. Tinkler, CLU, ChFC, RICP, CFP, CAP, is a Wealth Management Advisor at Northwestern Mutual in Denver, Colorado. She can be contacted at [email protected].

© All content copyright 2022 by InsuranceNewsNet.com Inc. All rights reserved. No part of this article may be reproduced without the express written consent of InsuranceNewsNet.com.