Understanding the LGBT Investor

 

The Lesbian, Gay, Bisexual and Transgender community of investors is willing to ask for financial assistance from providers and advisors but wants to know the needs of their community are understood and met.

A new Spectrem study of affluent LGBT investors show that, in many ways, the LGBT investor is similar to non-LGBT investors. However, the report shows that LGBT investors tend to be more conservative and less diversified in investing.

The legal complications that surround ownership of investments in LGBT relationships may be the cause of data that shows the LGBT investor is less confident about their investment knowledge than the non-LGBT investor. Overall, 21 percent of non-LGBT investors say they are knowledgeable about financial products and investments, while only 15 percent of LGBT investors say they are knowledgeable.

Among Ultra High Net Worth investors, with a net worth between $5 million and $25 million Not Including Primary Residence, the 41 percent of non-LGBT investors report being knowledgeable about financial products and investments while just 20 percent of the LGBT investors do so.

The report studied LGBT investors from three different wealth segments, ranging in net worth from $100,000 up to $25 million.

Although LGBT investors use the same financial providers as the non-LGBT community, according to the study, the LGBT investor wants to know the financial advisor understands their unique financial situations. Sixty-five percent of the LGBT investors say they would choose an advisor that is familiar with the LGBT community’s investment needs regarding estate palling, rusts and wills.

Females from the LGBT community are more likely than LGBT men to use a financial company with a specialty area for the needs of the LFBT investor (52 to 44), and female LGBT investors are also more likely than men to consider the financial rights and equal opportunities of the LGBT investor.

The report shows that the LGBT investors usually have a higher satisfaction rating in their advisors than the non-LGBT investor, and that extends the investor-advisor relationship to longer term status, since the satisfaction is often tied to understanding the needs of the LGBT investor.