Sales & Marketing | 12.11.24
Open to All: How Financial Professionals Can Reach LGBTQ+ Clients
by: BISA Member
The makeup of the U.S. population is changing, and so are the financial needs of diverse client groups. One such group that requires individual attention is the LGBTQ+ community.
A U.S. Census Bureau survey from 2021 that measures household probability in the U.S. found at least 20 million adults could be lesbian, gay, bisexual or transgender — nearly 8 percent of the total adult population.
Meanwhile, the purchasing power of the LGBTQ+ community in the U.S. is indeed significant. According to a report by The Pride Co-op, this group’s spending power in the U.S. was estimated to be around $1.4 trillion in 2021.
Given these findings, financial professionals have a robust opportunity to serve this community. However, that starts with understanding their specific needs and goals.
Understanding the LGBTQ+ Community
To best serve this clientele, financial professionals must first understand the LGBTQ+ community encompasses a wide range of identities, including lesbian, gay, bisexual, transgender, queer and others. Each subgroup within this community may face different financial challenges and goals. For instance, same-sex couples might have different estate planning needs, while transgender individuals may face higher healthcare costs and certain restrictions, depending on their age and where they live. Understanding these nuances is crucial for providing tailored financial advice. A comprehensive list of LGBTQ+ terms and identities can be found on The Human Rights Campaign’s website.
Why Reach Out to LGBTQ+ Clients?
- Untapped Market Potential: The LGBTQ+ community represents a significant and growing market. According to recent studies, the purchasing power of the LGBTQ+ community in the U.S. alone is estimated to be over $1 trillion. By reaching out to this community, financial professionals can tap into a lucrative market segment.
- Building Trust and Inclusivity: Many LGBTQ+ individuals have faced discrimination and may feel hesitant to seek financial advice. By actively reaching out and demonstrating inclusivity, financial professionals can build trust and create a welcoming environment. This not only helps in client retention but also enhances the financial professional’s reputation.
- Addressing Unique Financial Needs: LGBTQ+ clients often have different financial needs that require specialized knowledge. For example, understanding the legal complexities of same-sex marriage, adoption and inheritance laws can help advisors provide more accurate and relevant advice. By addressing these needs, advisors can offer more comprehensive and effective financial planning — which ultimately benefits all clients.
How to Reach Out to LGBTQ+ Clients
- Educate Yourself: Before reaching out, it’s essential to educate yourself about the LGBTQ+ community and their specific financial needs. Attend workshops, read relevant literature and engage with LGBTQ+ organizations to gain a deeper understanding. Financial professionals can also work with firms that offer thought leadership on how to reach the LGBTQ+ community.
- Create an Inclusive Environment: Ensure that your office and marketing materials reflect inclusivity. Use gender-neutral language, display LGBTQ+ friendly symbols (for example, a small pride flag) and highlight your commitment to diversity on your website and social media platforms. Consider displaying your pronouns in your electronic communication.
- Partner with LGBTQ+ Organizations: Collaborate with local LGBTQ+ organizations and participate in community events. This not only helps build relationships, but also demonstrates your commitment to supporting the community.
- Offer Specialized Services: Develop financial products and services tailored to the needs of LGBTQ+ clients. This could include estate planning for same-sex couples, retirement planning for transgender individuals and financial education workshops focused on LGBTQ+ issues.
- Communicate Sensitively: When engaging with LGBTQ+ clients, use inclusive and respectful language. Be mindful of pronouns and avoid making assumptions about their relationships or financial goals. Building a rapport based on respect and understanding is key to successful client relationships.
Reaching out to prospective LGBTQ+ clients is not only a sound business move, but also a step towards creating a more inclusive and equitable financial industry. By understanding this group’s unique needs and demonstrating a commitment to inclusivity, financial advisors can build lasting relationships and help LGBTQ+ clients achieve their financial goals. Embracing diversity and inclusivity is not just the right thing to do; it’s also good for business.