Almost mainstream, LGBTQ couples still need specialized planning

Advisers who serve gay and lesbian couples attract a rainbow of potential clients.

“We come out all the time,” said Laura J. LaTourette, founder of Family Wealth Management Group. “We have this one coming out day to our family, but we come out all the time to employers, strangers, extended family, and we choose how we will do that. Are we in a safe place? Will we be hurt or ridiculed? You’re always weighing it.”

When same-sex marriage was legalized nationally in June 2015, one thorny element of financial planning for gay and lesbian couples was resolved. With the same rights as heterosexual couples, they no longer needed to establish legal and financial protections through additional documents.

But LGBTQ financial planning is nuanced and couples still must address the hovering fear that the hard-won rights could be canceled by legislation or court decisions.

“There are still 28 states that don’t have any protections for workplace discrimination, where you can be fired for sexual orientation,” said Tyler Robuck, managing director and adviser with Manhattan West, an advisory firm. “As we’ve made huge gains, there is still work to be done on that front. Those rights can be taken away from us.”

Attention that advisers used to devote to “patching around” gaps in legal status with trusts and other tactics is now better directed to strategies that support other aspects of couples’ goals, said Robuck, who is married and the father of a son.

Often, gay and lesbian couples must deploy work-arounds to have families. Surrogacy, adoption and other modes of childbearing come with their own legal and financial complications, Robuck and LaTourette pointed out.

Gay and lesbian couples often run into family resistance — overt and passive — that can undermine estate planning and other entwined family financial structures. And because gay and lesbian couples can’t count on consistent legal protections globally, they must be ready to add financial and legal defenses if they intend to travel or work abroad, both Robuck and LaTourette said.

Overall, gay and lesbian couples earn more than heterosexual couples, according to Pew Research. In 2019, men in same-sex marriages lived in households with a median income of $132,300, while married heterosexual men had household incomes of about $90,700. Lesbian married couples’ median household income was about $101,900, compared to $91,100 for heterosexual married women.

For many LGBTQ individuals there’s a family — born or chosen — eager to affirm and support them —and avidly looking for equally affirming and supportive financial professionals, Robuck and LaTourette said.

Advisers who take the time to understand the financial and emotional nuances of the LGBTQ market are likely to find themselves with a steady stream of referrals.

LaTourette, who’s married and has adult children, cultivates her firm’s reputation as LGBTQ-friendly partly by hiring LGBTQ advisers and partly by high-profile advocacy within the industry and within the community, especially with SAGE, a nonprofit that tracks and supports financial and health stability for LGBTQ elders.

As such, she’s easily found by those who read compassion into her advocacy.

“Someone who googled ’lesbian financial planner’ found me, and called and said, ”I’m afraid for my trans son. And I realize you’re lesbian and I think you won’t be judgmental,” LaTourette said. “She was a new widow and needed to care for her son as she took over the financial affairs [from her late husband].”

“When you can talk with the LGBTQ community and you are aware of the laws that they are concerned about, that lets them know that you won’t let them be blindsided by something that could hurt them financially,” explained Robuck. “Building those deep connections reverberates through the LGBTQ community.”

Often, said LaTourette, ongoing clients also appreciate a sounding board when someone’s LGBTQ status seems to complicate life transitions and decisions.

“I had a colleague call and ask what to do with a client who wasn’t sure if he was supposed to pay for his child’s transgender wedding,” she related. “I asked, ‘Would he pay for any wedding for this child?’ And the answer was, ‘Yes, but she’s not going to wear a dress.’ I said, “Why would things change because his child wanted to wear a suit and not a dress? You tell that man to love that child. This is not hard stuff.”